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Analysts told investors that the firm has underappreciated the value of GOLF’s best-in-class portfolio in a healthy golf industry, and it has been a “lesson learned.”
There are strong secular tailwinds to drive long-term growth ahead for the company, according to Konik. “As the U.S. population ages, we expect to see sustainable growth in rounds played, amplified by growth in new entrants, ensuring steady demand for golf OEMs ahead,” the analysts wrote.
“After ~14% and ~5% Y/Y growth in rounds played in CY’20 and CY’21, respectively, CY’22 rounds played remained a solid ~16% ahead of 2019 levels. YTD rounds played are still running +6% Y/Y. The sport of golf has established a new baseline, in our view,” they added.
Meanwhile, Jefferies believes GOLF’s “custom capabilities unlock a penetration opportunity and incremental pricing,” while investors are “likely to pay more for a larger share of a consolidated market.”
“Looking ahead, GOLF is poised to defend its #1 share in golf balls and shoes, and gain share in #3 clubs, particularly metals, through broader appeal; while expanding margins on steady MSD% revs,” they concluded.
