Head-To-Head Survey: CoStar Group (CSGP) vs. Broadridge Financial Solutions (BR)

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Broadridge Financial Solutions (NYSE:BR) and CoStar Group (NASDAQ:CSGP) are both large-cap business services companies, but which is the better business? We will compare the two companies based on the strength of their dividends, analyst recommendations, profitability, earnings, risk, institutional ownership and valuation.

Dividends

Broadridge Financial Solutions pays an annual dividend of $1.94 per share and has a dividend yield of 2.0%. CoStar Group does not pay a dividend. Broadridge Financial Solutions pays out 46.3% of its earnings in the form of a dividend. Broadridge Financial Solutions has increased its dividend for 11 consecutive years.

Analyst Ratings

This is a summary of recent ratings and target prices for Broadridge Financial Solutions and CoStar Group, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Broadridge Financial Solutions 0 5 1 0 2.17
CoStar Group 1 0 7 0 2.75

Broadridge Financial Solutions currently has a consensus price target of $108.40, suggesting a potential upside of 9.74%. CoStar Group has a consensus price target of $457.75, suggesting a potential upside of 27.41%. Given CoStar Group’s stronger consensus rating and higher possible upside, analysts clearly believe CoStar Group is more favorable than Broadridge Financial Solutions.

Risk & Volatility

Broadridge Financial Solutions has a beta of 0.93, meaning that its share price is 7% less volatile than the S&P 500. Comparatively, CoStar Group has a beta of 1.45, meaning that its share price is 45% more volatile than the S&P 500.

Earnings and Valuation

This table compares Broadridge Financial Solutions and CoStar Group’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Broadridge Financial Solutions $4.33 billion 2.66 $427.90 million $4.19 23.58
CoStar Group $965.23 million 13.56 $122.69 million $3.87 92.83

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

Profitability

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

Net Margins Return on Equity Return on Assets
Broadridge Financial Solutions 10.39% 46.83% 15.92%
CoStar Group 17.61% 7.63% 6.97%

Insider and Institutional Ownership

83.5% of Broadridge Financial Solutions shares are held by institutional investors. Comparatively, 95.5% of CoStar Group shares are held by institutional investors. 2.3% of Broadridge Financial Solutions shares are held by company insiders. Comparatively, 2.5% of CoStar Group shares are held by company 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 Broadridge Financial Solutions on 10 of the 17 factors compared between the two stocks.

About Broadridge Financial Solutions

Broadridge Financial Solutions, Inc. provides investor communications and technology-driven solutions for the financial services industry worldwide. The company's Investor Communication Solutions segment processes and distributes proxy materials to investors in equity securities and mutual funds, as well as facilitates related vote processing services; and offers ProxyEdge, an electronic proxy delivery and voting solution. It also provides registered proxy, registrar, stock transfer, and record-keeping services to corporations; and distributes regulatory reports and corporate action/reorganization event information, and tax reporting solutions. In addition, this segment offers customer communication solutions, including processing and distributing its clients' transactional, regulatory, and marketing communications through print and digital channels. Further, it provides cloud-based marketing and customer communication tools, as well as customer and account data aggregation and reporting services; and creates sales and educational content, including seminars and a library of financial planning topics, as well as customizable advisor Websites, search engine marketing, and electronic and print newsletters. Additionally, this segment offers mutual fund and retirement, and mutual fund trade processing services. The company's Global Technology and Operations segment offers middle- and back-office securities processing solutions that include desktop productivity tools, data aggregation, performance reporting, portfolio management, order capture and execution, trade confirmation, margin, cash management, clearance and settlement, asset servicing, reference data management, reconciliation, securities financing and collateral optimization, compliance and regulatory reporting, and accounting. It also provides international securities processing and managed services. The company was founded in 1962 and is headquartered in Lake Success, New York.

About CoStar Group

CoStar Group, Inc. provides information, analytics, and online marketplace to the commercial real estate industry in North America and internationally. The company offers CoStar Property Professional service that provides inventory of office, industrial, retail, and multifamily properties and land. It also provides CoStar COMPS Professional, which covers comparable commercial real estate sales information; CoStar Tenant, an online business-to-business prospecting and analytical tool; CoStarGo, an iPad and Android application; CoStar Lease Comps, an integrated solution that captures, manages, maintains, and analyzes lease data; CoStar Advertising to market a space for lease or a property for sale; and CoStar Portfolio Strategy to meet the research needs of commercial real estate owners, investors, lenders, and government regulators. In addition, the company offers CoStar Investment Analysis Portfolio Maximizer, CoStar Investment Analysis Request, CoStar Real Estate Manager Corporate Edition, and CoStar Real Estate Manager Retail Edition that are real estate management software solutions; CoStar Private Sale Network, which provides clients with custom-designed and branded Websites; and CoStar Brokerage Applications. Further, it offers LoopNet Premium Lister and LoopNet Power Listings for commercial real estate professionals and other customers to market their listings; LoopNet Premium Searcher for members searching for commercial real estate; LoopLink, an online real estate marketing and database services suite; apartment marketing sites, including Apartments.com, ApartmentFinder.com, ForRent.com, ApartmentHomeLiving.com, Apartamentos.com, WestsideRentals.com, and The Screening Pros; LandsofAmerica, LandAndFarm, and LandWatch that are online marketplaces for rural land for sale; and BizBuySell and BizQuest that are online marketplaces for operating businesses for sale. The company was founded in 1987 and is headquartered in Washington, the District of Columbia.

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