Yahoo Finance The CoStar Group (NASDAQ:CSGP) Share Price Is Up 379% And Shareholders Are Delighted
Long term investing can be life changing when you buy and hold the truly great businesses. While not every stock performs well, when investors win, they can win big. Don't believe it? Then look at the CoStar Group, Inc. (NASDAQ:CSGP) share price. It's 379% higher than it was five years ago. If that doesn't get you thinking about long term investing, we don't know what will. Unfortunately, though, the stock has dropped 7.2% over a week. But this could be related to the soft market, with stocks selling off around 1.0% in the last week.
View our latest analysis for CoStar Group
To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
During the five years of share price growth, CoStar Group moved from a loss to profitability. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here. Since the company was unprofitable five years ago, but not three years ago, it's worth taking a look at the returns in the last three years, too. Indeed, the CoStar Group share price has gained 150% in three years. Meanwhile, EPS is up 31% per year. That makes the EPS growth rather close to the annualized share price gain of 36% over the same period. That suggests that the market sentiment around the company hasn't changed much over that time. Arguably the share price is reflecting the earnings per share.
The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).
We know that CoStar Group has improved its bottom line over the last three years, but what does the future have in store? You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.
A Different Perspective
We're pleased to report that CoStar Group shareholders have received a total shareholder return of 31% over one year. However, the TSR over five years, coming in at 37% per year, is even more impressive. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Case in point: We've spotted 1 warning sign for CoStar Group you should be aware of.
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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