CoStar Group (CSGP) Fell On Low Non-Subscription Revenues
Baron Funds, an investment management company, released its “Baron Asset Fund” third quarter 2023 investor letter. A copy of the same can be downloaded here. The market rally that was driven by technology this year came to a halt in the third quarter. Against this backdrop, the Baron Asset Fund declined 4.42% (Institutional Shares) in the third quarter outperforming the Russell Midcap Growth Index’s -5.22% return. Positive stock selection and tailwinds from its style biases drove the outperformance in the quarter. The Fund’s underexposure to higher beta stocks, which performed poorly during the market reversal was another notable factor. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Baron Asset Fund highlighted stocks like CoStar Group, Inc. (NASDAQ:CSGP) in the third quarter 2023 investor letter. Headquartered in Washington, the District of Columbia, CoStar Group, Inc. (NASDAQ:CSGP) provides information, analytics, and online marketplace services to commercial and residential property markets. On November 10, 2023, CoStar Group, Inc. (NASDAQ:CSGP) stock closed at $79.65 per share. One-month return of CoStar Group, Inc. (NASDAQ:CSGP) was -0.81%, and its shares lost 4.36% of their value over the last 52 weeks. CoStar Group, Inc. (NASDAQ:CSGP) has a market capitalization of $32.526 billion.
Baron Asset Fund made the following comment about CoStar Group, Inc. (NASDAQ:CSGP) in its Q3 2023 investor letter:
"CoStar Group, Inc. (NASDAQ:CSGP) provides marketing and data analytics to the commercial and residential real estate industries. Shares detracted from performance after the company’s financial results were negatively impacted by lower non-subscription revenues, which resulted from a significant drop in commercial real estate sales volumes. We are optimistic that volumes will recover. More importantly, we believe trends in the company’s core subscription offerings remain excellent, and we are encouraged by growing traction in CoStar’s nascent residential offerings. We estimate CoStar invested around $230 million in this initiative in 2022 and is targeting a total investment approaching $500 million in 2023. While this is a significant upfront commitment, we believe residential represents a transformative opportunity for CoStar. We believe the company’s proprietary data, its compelling value for residential home brokers, and best-in-class management position it to succeed in this endeavor."
An elegant residential building set against the modern skyline.
CoStar Group, Inc. (NASDAQ:CSGP) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 38 hedge fund portfolios held CoStar Group, Inc. (NASDAQ:CSGP) at the end of second quarter which was 43 in the previous quarter.
We discussed CoStar Group, Inc. (NASDAQ:CSGP) in another article and shared the list of low risk high reward stocks set to triple by 2027. In addition, please check out our hedge fund investor letters Q3 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
