Topgolf Callaway Brands (MODG) AI Stock Analysis

• Market Cap: $1.74B
• Dividend Yield: N/A
• Average Volume (3M): 2.22M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.79
• Revenue Growth: -2.35%
• EPS Growth: -7104.57%
• Country: US
• Employees: 30,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Leisure
• EPS (TTM): 0.24
• Shares Outstanding: 183,865,620
• 10 Day Avg. Volume: 2,154,167
• 30 Day Avg. Volume: 2,223,177
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 3.01
• Enterprise Value/Revenue: 1.27
• Enterprise Value/Gross Profit: 1.98
• Enterprise Value/Ebitda: -5.34
• 1Y Price Target: $9.88
• Price Target Upside: 4.33% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 9

• Rating: 51 Neutral
• Price Target: $9.00 ▼(-4.96% Downside)

Topgolf Callaway Brands faces significant financial challenges, with declining revenues and profitability issues weighing heavily on its score. However, the company has shown resilience in its earnings call, raising guidance and improving performance in key segments. Technical indicators suggest weak momentum, and valuation metrics highlight ongoing profitability concerns. The strategic sale of Jack Wolfskin and improved Topgolf traffic are positive developments, but the overall outlook remains cautious.

Positive Factors

Improved Topgolf Traffic

The increase in Topgolf traffic indicates strong consumer engagement and effective value initiatives, which can drive sustained revenue growth and enhance the company's competitive position in the entertainment sector.

Golf Equipment Segment Success

The strong performance in the golf equipment segment suggests robust demand and effective product strategies, supporting long-term revenue and margin stability in a key business area.

Strategic Focus Post-Jack Wolfskin Sale

The sale of Jack Wolfskin allows the company to concentrate resources on its core operations, potentially improving operational efficiency and financial health over the long term.

Negative Factors

Declining Revenue Growth

The decline in revenue growth reflects challenges in maintaining market share and demand, which could hinder long-term financial performance if not addressed.

High Leverage

Significant leverage can limit financial flexibility and increase risk, potentially impacting the company's ability to invest in growth and weather economic downturns.

Declining Free Cash Flow

Reduced free cash flow growth indicates challenges in generating cash from operations, which could constrain the company's capacity to fund new initiatives and manage debt.

Topgolf Callaway Brands Business Overview & Revenue Model

Company Description

Topgolf Callaway Brands (MODG) is a leading global sports and entertainment company that operates in the golf and lifestyle sector. The company is best known for its innovative golf entertainment venues, which combine a high-tech driving range with a vibrant social atmosphere, attracting a diverse audience of golf enthusiasts and casual players alike. In addition to its entertainment offerings, Topgolf Callaway Brands also encompasses a wide range of golf equipment, apparel, and accessories, catering to both amateur and professional golfers.

How the Company Makes Money

Topgolf Callaway Brands generates revenue through multiple streams, primarily from its proprietary golf entertainment venues where customers pay for game play, food, and beverages. Each venue operates on a pay-per-game basis, with customers reserving bays for their groups. Additionally, the company earns money through food and beverage sales, which are a significant part of the overall customer experience. Another key revenue stream comes from the sale of golf equipment and accessories, including clubs, balls, and apparel, both within the venues and through online platforms. The company also benefits from partnerships with various brands for sponsorships and promotions, further enhancing its revenue potential. Seasonal events and corporate events hosted at the venues provide additional income, as businesses often rent spaces for team-building activities or client entertainment. Overall, the combination of venue operations, retail sales, and strategic partnerships contributes to the company's financial performance.

Topgolf Callaway Brands Financial Statement Overview

Summary

Topgolf Callaway Brands is facing financial challenges across all verticals. The income statement highlights declining revenues and negative profitability margins. The balance sheet shows high leverage, while cash flow analysis indicates declining free cash flow growth. The company needs to address these issues to improve financial stability and profitability.

Income Statement

Topgolf Callaway Brands has experienced declining revenue growth, with a negative growth rate of -1.13% in the TTM period. The company is facing significant profitability challenges, as indicated by negative net profit and EBIT margins. Gross profit margin remains relatively strong at 64.04%, but the overall profitability is hindered by high operating expenses.

Balance Sheet

The company's balance sheet shows a high debt-to-equity ratio of 1.17 in the TTM period, indicating significant leverage. Return on equity is negative, reflecting the company's struggle to generate profits from shareholders' equity. However, the equity ratio remains stable, suggesting a balanced asset structure.

Cash Flow

Cash flow analysis reveals a decline in free cash flow growth by -24.08% in the TTM period. The operating cash flow to net income ratio is below 1, indicating challenges in converting income into cash. Despite a positive free cash flow to net income ratio, the overall cash flow position is weak.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.14B	4.24B	4.28B	4.00B	3.13B	1.59B
Gross Profit	2.65B	2.65B	2.65B	2.41B	1.86B	657.59M
EBITDA	-983.10M	-973.60M	484.70M	455.10M	707.45M	-5.69M
Net Income	-1.49B	-1.45B	95.00M	157.90M	322.00M	-126.93M
Balance Sheet
Total Assets	7.61B	7.64B	9.12B	8.59B	7.75B	1.98B
Cash, Cash Equivalents and Short-Term Investments	683.50M	445.00M	398.70M	180.20M	352.22M	366.12M
Total Debt	2.90B	4.46B	4.36B	2.91B	2.95B	894.87M
Total Liabilities	5.12B	5.23B	5.24B	4.82B	4.06B	1.30B
Stockholders Equity	2.49B	2.41B	3.88B	3.77B	3.68B	675.64M
Cash Flow
Free Cash Flow	275.00M	86.60M	-118.10M	-570.60M	-44.02M	188.98M
Operating Cash Flow	471.80M	382.00M	364.70M	-35.10M	278.26M	228.24M
Investing Cash Flow	17.00M	-297.30M	-542.90M	-535.10M	-161.86M	-59.21M
Financing Cash Flow	72.50M	-23.60M	375.80M	425.30M	-124.10M	96.07M

Topgolf Callaway Brands Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 9.47
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MODG, the sentiment is Positive. The current price of 9.47 is above the 20-day moving average (MA) of 9.35, above the 50-day MA of 9.38, and above the 200-day MA of 7.84, indicating a bullish trend. The MACD of -0.02 indicates Positive momentum. The RSI at 52.54 is Neutral, neither overbought nor oversold. The STOCH value of 32.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MODG.

Topgolf Callaway Brands Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GOLF	73 Outperform	4.50B	20.15	0.03%	1.20%	3.83%	28.57%
YETI	69 Neutral	2.79B	16.42	22.07%	―	3.63%	-2.60%
OSW	69 Neutral	2.23B	31.74	12.98%	0.74%	8.51%	31.24%
JOUT	64 Neutral	409.06M	-10.26	-8.77%	3.31%	-3.56%	-407.47%
MODG	51 Neutral	$1.74B	―	-46.53%	―	-2.35%	-7104.57%
XPOF	44 Neutral	382.18M	-4.47	54.02%	―	-3.02%	-517.53%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

Topgolf Callaway Brands Corporate Events

Topgolf Callaway Brands Board Restructures After Director Resignation

On August 25, 2025, Scott M. Marimow resigned from his position as a director at Topgolf Callaway Brands Corp. His departure was not due to any disagreements with the company’s operations or policies. Subsequently, on August 26, 2025, the company’s Board of Directors decided to reduce its size to 10 members.

Topgolf Callaway CEO Resigns Amid Strategic Plans

On July 29, 2025, Arthur F. Starrs, CEO of Topgolf, announced his resignation to take up a CEO position with another company, effective through September 2025 to ensure a smooth transition. Despite his departure, Topgolf Callaway Brands remains committed to its strategic direction, including the potential spin-off or sale of Topgolf, which is now likely to be delayed until 2026 after a new CEO is appointed. The company is actively searching for a replacement while continuing to focus on its financial performance and strategic goals.

Topgolf Callaway Sells Jack Wolfskin to ANTA Sports

On May 31, 2025, Topgolf Callaway Brands completed the sale of its Jack Wolfskin business to ANTA Sports for $290 million. This transaction marks a strategic shift for the company, allowing it to focus on its core businesses and enhance financial flexibility, particularly in anticipation of separating Topgolf from its core operations.

Topgolf Callaway Brands Approves Amended 2022 Incentive Plan

On May 29, 2025, Topgolf Callaway Brands Corp. held its annual meeting of shareholders, where the amended and restated 2022 Incentive Plan was approved. This plan, effective from the meeting date, increases the shares available for issuance and outlines specific terms for stock options and awards. The meeting also saw the approval of other proposals, including the election of directors, ratification of Deloitte & Touche LLP as the independent auditor, and an advisory vote on executive compensation, all of which reflect the company’s ongoing governance and operational strategies.