Topic: How To Invest

Q: Pat: What’s the outlook for Callaway Golf? Thank you.

Article Excerpt

A: Callaway Golf Co., $27.51, symbol ELY on New York (Shares outstanding: 184.2 million; Market cap: $5.0 billion; www.callawaygolf.com), makes golf clubs and balls, as well as apparel. From 2016 to 2019, Callaway’s total revenue saw strong growth, rising 82.3% from $871.2 million in 2016 to $1.70 billion in 2019. That in part reflects the company’s $476-million acquisition of U.K.-based Jack Wolfskin in January 2019. Specifically, that apparel maker drove a 36.9% revenue jump in 2019. Due to COVID-19 and the lockdown of retail shopping and recreational facilities, Callaway’s sales in 2020 fell by 6.6% to $1.59 billion. Earnings grew steadily between 2016 and 2019, rising 225.4% from $32.7 million, or $0.34 a share, in 2016 to $106.4 million, or $1.10, in 2019. Earnings then dropped 39.8% in 2020, to $64.0 million, or $0.67 a share. That decline was also due to COVID-19. For the fourth quarter, ended December 31, 2020, overall revenue jumped 20.1%, to $374.6 million from $311.9 million a year…