After four consecutive quarters in which its profits dropped, CoStar Group said it generated $74 million in Q1 net income, the company announced. The firm’s profits are relatively flat year-over-year.
Be Smart: CoStar noted that the opportunity in residential is so large because the current online players are overly focused on capturing agents’ fees. Few firm’s have CoStar’s war chest: As of March 31, it held $3.7 billion in cash and investments plus $987 million in debt.
What comes next: The data giant is planning to launch a lending product that could generate $300 million in annual revenue.
Optimistic outlook: CoStar is raising its revenue guidance for the full year of 2021 to a new range of $1.930 billion to $1.945 billion, representing growth of approximately 17% year-over-year at the midpoint of the range.
Backdrop: The company recently reached an agreement to buy residential property listing site Homes.com for a total of $156 million in cash. The site boasts 5 million visitors per month and nearly 1.8 million residential property listings. CoStar also plans to combine the company with Homesnap, a workflow and marketing platform for residential real estate agents that CoStar acquired in December.
Heard on the Street: Founder & CEO Andy Florence: “We expect this positive momentum to continue during the remainder of 2021, supported by the recent addition of both Commercial Mortgage-Backed Securities data and STR hospitality data in CoStar Suite, and the launch of the new CoStar international version earlier this month.” [TRD+EarningsTranscript]