Reviewing CoStar Group (NASDAQ:CSGP) and Paypal (NASDAQ:PYPL)

CoStar Group (NASDAQ:CSGP) and Paypal (NASDAQ:PYPL) are both large-cap computer and technology companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, dividends, analyst recommendations, risk and valuation.

Volatility & Risk

CoStar Group has a beta of 1.34, indicating that its stock price is 34% more volatile than the S&P 500. Comparatively, Paypal has a beta of 0.96, indicating that its stock price is 4% less volatile than the S&P 500.

Profitability

This table compares CoStar Group and Paypal’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CoStar Group 23.17% 10.55% 9.40%
Paypal 14.89% 16.73% 5.61%

Analyst Ratings

This is a summary of recent ratings and target prices for CoStar Group and Paypal, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CoStar Group 1 1 8 0 2.70
Paypal 0 7 23 0 2.77

CoStar Group currently has a consensus price target of $624.80, indicating a potential upside of 5.79%. Paypal has a consensus price target of $123.35, indicating a potential upside of 21.21%. Given Paypal’s stronger consensus rating and higher possible upside, analysts clearly believe Paypal is more favorable than CoStar Group.

Valuation & Earnings

This table compares CoStar Group and Paypal’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CoStar Group $1.19 billion 18.15 $238.33 million $7.40 79.81
Paypal $15.45 billion 7.73 $2.06 billion $1.79 56.85

Paypal has higher revenue and earnings than CoStar Group. Paypal is trading at a lower price-to-earnings ratio than CoStar Group, indicating that it is currently the more affordable of the two stocks.

Insider & Institutional Ownership

94.9% of CoStar Group shares are owned by institutional investors. Comparatively, 81.7% of Paypal shares are owned by institutional investors. 2.1% of CoStar Group shares are owned by insiders. Comparatively, 0.2% of Paypal shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company will outperform the market over the long term.

Summary

CoStar Group beats Paypal on 8 of the 14 factors compared between the two stocks.

CoStar Group Company Profile

CoStar Group, Inc. provides information, analytics, and online marketplaces to the commercial real estate industry in the United States and the United Kingdom. The company offers CoStar Property Professional service that offers inventory of office, industrial, retail, and multifamily properties and land. It also provides CoStar COMPS Professional that covers comparable commercial real estate sales information; CoStar Tenant, an online business-to-business prospecting and analytical tool; CoStar Lease Comps, a solution to capture, manage, and maintain lease data; CoStar Lease Analysis, a workflow tool; CoStar Advertising to market a space for lease or a property for sale; CoStar Private Sale Network, which provides custom-designed and branded Websites; and CoStar and CoStar Go CoStar mobile apps. In addition, the company offers CoStar Real Estate Manager, a real estate and asset management, and lease accounting software; CoStar Risk Analytics, a commercial real estate risk management tool; CoStar Brokerage Applications; CoStar Investment Analysis Request, a business intelligence software; and CoStar Investment Analysis Portfolio Maximizer, a real estate portfolio management software. Further, it provides apartment marketing sites, such as Apartments.com, ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, Apartamentos.com, WestsideRentals.com, and Cozy.co; LoopNet Premium Lister and LoopNet Power Listings for commercial real estate professionals; LoopLink, an online real estate marketing and database services suite; Listing Manager, an online listing tool; Realla, a commercial property listings and data management platform; LandsofAmerica, LandAndFarm, and LandWatch online marketplaces for rural land for sale; and BizBuySell and BizQuest online marketplaces for operating businesses for sale. The company has a strategic relationship with Buxton Company. The company was founded in 1987 and is headquartered in Washington, the District of Columbia.

Paypal Company Profile

PayPal Holdings, Inc. operates as a technology platform and digital payments company that enables digital and mobile payments on behalf of consumers and merchants worldwide. Its payment solutions include PayPal, PayPal Credit, Braintree, Venmo, Xoom, and iZettle products. The company's Payments Platform allows consumers to send payments, withdraw funds to their bank accounts, and hold balances in their PayPal accounts in various currencies. It also offers gateway services that enable merchants to accept payments online with credit or debit cards. PayPal Holdings, Inc. was founded in 1998 and is headquartered in San Jose, California.

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