CoStar Group
CSGP
shares ended the last trading session 5.3% higher at $798.69. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock’s 17.5% loss over the past four weeks.
The upswing in share price came after CoStar announced that it has withdrawn its bid to acquire CoreLogic
CLGX
. The company noted that rising interest rates have resulted in a significant decline in residential property technology companies’ valuations. Therefore, CoStar believes this is not the right time to make aggressive acquisitions in the residential mortgage market.
Price and Consensus
This commercial real estate information and marketing provider is expected to post quarterly earnings of $2.40 per share in its upcoming report, which represents a year-over-year change of -1.6%. Revenues are expected to be $453.75 million, up 15.8% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For CoStar, the consensus EPS estimate for the quarter has been revised 11.3% lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn’t usually translate into price appreciation. So, make sure to keep an eye on CSGP going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank 3 (Hold). You can see
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