CoStar Group Soared 6.14%—What’s Fueling This Record Surge?

Summary
• CoStar Group (CSGP) surged 6.14% intraday, hitting a 52-week high of $91.13.
• Q2 revenue rose 15% to $781 million, with net new bookings up 65% to $93 million.
• Analysts raised price targets, with Goldman Sachs and JPMorgan setting $105 and $101 targets, respectively.

The stock’s meteoric rise reflects a perfect storm of robust earnings, record bookings, and upgraded guidance. CoStar’s 52-week high at $91.13 underscores investor confidence in its market-leading real estate platforms and strategic pricing initiatives. With a 6.14% surge, the stock’s momentum suggests a re-rating of its long-term growth potential in the digital real estate landscape.

Earnings Beat and Strategic Pricing Drive Rally
CoStar’s 6.14% surge was ignited by Q2 results that exceeded expectations. Revenue of $781 million, up 15% year-over-year, and adjusted EBITDA of $85 million, up 108%, signaled strong demand for its real estate platforms. The 65% jump in net new bookings to $93 million highlighted the company’s pricing discipline and product stickiness, particularly in Apartments.com and Homes.com. Management’s guidance raise to $3.135 billion–$3.155 billion revenue and $370 million–$390 million EBITDA further reinforced optimism. Analysts like Goldman Sachs and JPMorgan amplified the momentum by upgrading price targets, citing CoStar’s scalable business model and competitive positioning.

Real Estate Services Sector Outperforms as Zillow Trails
While CoStar Group surged 6.14%, the broader Real Estate Services sector saw mixed performance. Zillow Group (Z), a key peer, posted a meager 0.18% gain, underscoring CoStar’s outperformance driven by its diversified revenue streams and disciplined margin management. Unlike Zillow’s antitrust concerns and pricing pressures, CoStar’s strategic focus on premium listings and high-value services—such as Matterport integrations and tiered pricing models—has insulated it from sector-wide headwinds. This divergence highlights CoStar’s structural advantages in capturing market share amid shifting consumer preferences.

Options and ETFs for Capitalizing on CoStar’s Momentum
• MACD: 1.55 (above signal line), RSI: 65.49 (neutral), 200D MA: $77.07 (below price)
• Bollinger Bands: Price at $90.39 (above upper band of $87.16), Support/Resistance: Key support at $81.06, resistance at $91.13

CoStar’s breakout above Bollinger bands and positive MACD suggest a continuation of its rally. For traders, the CSGP20250815C95 call option (strike $95, expiration Aug 15) offers a 119% leverage ratio and 5.00% price change potential. With a delta of 0.237 and implied volatility of 24.23%, it balances directional exposure and time decay (theta of -0.0737). The CSGP20250815P85 put option (strike $85, leverage 150.73%) provides downside protection, though its delta of -0.170 suggests limited near-term bearish potential. A 5% upside projection (to $94.90) would yield a $9.90 payoff for the C95 call, while the P85 put would expire worthless. Aggressive bulls may consider CSGP20250815C95 into a retest of $91.13 resistance.

Backtest CoStar Group Stock Performance
The backtest of CSGP's performance after an intraday surge of 6% shows mixed results. While the 3-day win rate is 49.51%, indicating the stock declined half the time, the 10-day win rate is also 49.51%, suggesting a higher likelihood of recovery. The 30-day win rate is slightly better at 54.08%, with an average return of 0.63% over that period. The maximum return during the backtest was 0.91%, which occurred on day 59, suggesting that while there is potential for gains, they may be modest.

Seize the Rally—But Watch for Zillow’s Moves
CoStar Group’s 6.14% surge is a testament to its pricing power and scalable platform strategy. The stock’s breakout above key resistance at $91.13 and strong options volume signal a high-conviction trade for investors. However, Zillow’s 0.18% underperformance and antitrust risks highlight sector-specific challenges. Traders should monitor CoStar’s ability to hold above $88.28 (intraday low) and watch for Zillow’s strategic responses. With a 119% leverage call option and a bullish technical setup, now is the time to position for a continuation of this momentum-driven rally.