Topgolf Callaway Brands (MODG) AI Stock Analysis

• Market Cap: $2.68B
• Dividend Yield: N/A
• Average Volume (3M): 2.40M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.02
• Revenue Growth: -3.58%
• EPS Growth: -12720.97%
• Country: US
• Employees: 30,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Leisure
• EPS (TTM): -0.05
• Shares Outstanding: 183,883,640
• 10 Day Avg. Volume: 2,382,643
• 30 Day Avg. Volume: 2,400,935
• PEG Ratio: <0.01
• Price to Book (P/B): 0.60
• Price to Sales (P/S): 0.34
• P/FCF Ratio: 16.67
• Enterprise Value/Market Cap: 1.99
• Enterprise Value/Revenue: 1.31
• Enterprise Value/Gross Profit: 2.03
• Enterprise Value/Ebitda: -5.41
• 1Y Price Target: $12.50
• Price Target Upside: -14.85% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 11
• EPS Forecast (FY): -0.17
• Revenue Forecast (FY): $3.66B

• Rating: 62 Neutral
• Price Target: $14.00 ▼(-4.63% Downside)

The score is held back primarily by weak profitability and deteriorating free cash flow, despite strong technical momentum. Positive catalysts from the earnings call (raised guidance) and corporate actions (Topgolf stake sale, major debt paydown, and buyback authorization) improve the outlook, while valuation remains constrained by a negative P/E and no stated dividend yield.

Positive Factors

Material debt reduction and improved liquidity

The sale generated ~$800M net proceeds and funded a $1.0B term-loan repayment, materially lowering gross borrowings. This durable reduction in leverage and higher available liquidity improves financial flexibility, lowers interest burden, and strengthens capacity for capex and strategic investments over months.

Strategic refocus on core Golf Equipment business

Management is repositioning as a pure-play golf equipment company, changing the corporate name and ticker and keeping a 40% Topgolf stake with marketing ties. This sharpens strategic focus, simplifies operations and capital allocation, while preserving exposure to Topgolf upside via a minority interest.

Resilient product-level performance and high gross margins

The equipment segment grew modestly while product categories (clubs, balls) showed consistent demand. Combined with a reported gross margin of ~64.6%, this indicates durable pricing power and production efficiency in core products, supporting sustainable segment-level earnings even if operating margins lag.

Negative Factors

Severely weakened free cash flow generation

An ~87% decline in free cash flow over the trailing period signals a structural cash-generation problem. Limited free cash constrains reinvestment, debt servicing and shareholder returns, forcing reliance on asset sales or financing to fund operations and strategic initiatives over the medium term.

Ongoing negative profitability and revenue pressure

Declining top-line and persistent negative operating and net margins show the company is not converting sales into sustainable profitability. This undermines return-on-equity and limits internal funding for growth, making long-term operating improvement and margin recovery essential for durable financial health.

Structural headwinds: tariffs, Asia weakness, and Topgolf bay declines

Rising tariff costs (forecasted at ~$40M) increase input cost pressure and compress margins. Coupled with persistent weakness in Asian markets and declines in Topgolf 3-plus bay business, these are multi-quarter structural challenges that can dampen revenue growth and require sustained strategic responses to restore global and venue-level performance.

Topgolf Callaway Brands Business Overview & Revenue Model

Company Description

Topgolf Callaway Brands Corp. designs, manufactures, and sells golf equipment, golf and lifestyle apparel, and other accessories. It operates through three segments: Topgolf; Golf Equipment; and Apparel, Gear and Other. The Topgolf segment operates Topgolf venues equipped with technology-enabled hitting bays, multiple bars, dining areas, and event spaces, as well as Toptracer ball-flight tracking technology; and World Golf Tour digital golf game. The Golf Equipment segment provides drivers, fairway woods, hybrids, irons, wedges and packaged sets, putters, and pre-owned golf clubs under the Callaway and Odyssey brands, as well as golf balls under the Callaway Golf and Strata brands. The Apparel, Gear and Other segment offers golf apparel and footwear; golf accessories, including golf bags, golf gloves, headwear, and practice aids under the Callaway brand; and golf and lifestyle apparel, hats, luggage and accessories, footwear, belts, facemasks, sunglasses, socks, and underwear under the TravisMathew brand. This segment also provides storage gear for sport and personal use, such as backpacks; travel, duffel, and golf bags; and storage gear accessories, as well as outerwear, headwear, and accessories under the OGIO brand. In addition, it offers outdoor apparel comprising jackets, trousers, dresses, skirts, and tops; and footwear and outdoor equipment, including packs and bags, travel bags, tents, sleeping bags, and accessories under the Jack Wolfskin brand. The company sells its products through golf retailers, sporting goods retailers, on-line retailers, mass merchants, department stores, third-party distributors, and mail order stores, as well as through its websites in the United States and approximately 120 countries. The company was formerly known as Callaway Golf Company and changed its name to Topgolf Callaway Brands Corp. in September 2022. Topgolf Callaway Brands Corp. was incorporated in 1982 and is headquartered in Carlsbad, California.

How the Company Makes Money

Topgolf Callaway Brands generates revenue through multiple streams, primarily from its Topgolf venues, which earn income through game play fees, food and beverage sales, and event hosting. Each venue operates a high-tech driving range where customers pay for access to hitting bays equipped with interactive gaming technology. Additionally, the sale of Callaway's golf equipment, including clubs and balls, serves as a significant revenue source. The company also engages in merchandise sales and partnerships, including collaborations with other brands and sponsorships, which further enhance its earnings. The combination of these diverse revenue streams and a strong brand presence in the golf industry solidifies the company's financial performance.

Topgolf Callaway Brands Financial Statement Overview

Summary

Topgolf Callaway Brands faces significant financial challenges, particularly in terms of profitability and cash flow generation. While the company maintains a strong gross profit margin and has improved its leverage position, negative revenue growth and profitability metrics indicate a need for strategic adjustments. The cash flow situation is concerning, with declining free cash flow and limited cash conversion from operations.

Income Statement

Topgolf Callaway Brands has experienced declining revenue growth in recent periods, with a negative growth rate of -1.91% in the TTM. The company also faces challenges with profitability, as evidenced by negative net profit and EBIT margins. However, the gross profit margin remains relatively strong at 64.55%, indicating efficient cost management at the production level.

Balance Sheet

The company's debt-to-equity ratio has improved to 0.78 in the TTM, indicating a reduction in leverage compared to previous years. However, the return on equity remains negative, reflecting ongoing profitability challenges. The equity ratio is stable, suggesting a balanced asset structure.

Cash Flow

Cash flow performance is weak, with a significant decline in free cash flow growth of -87.49% in the TTM. The operating cash flow to net income ratio is low, indicating challenges in converting earnings into cash. The free cash flow to net income ratio is also low, reflecting limited cash generation relative to net losses.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.06B	4.24B	4.28B	4.00B	3.13B	1.59B
Gross Profit	2.62B	2.65B	2.65B	2.41B	1.86B	657.60M
EBITDA	-985.60M	-973.60M	484.70M	477.50M	622.00M	-41.10M
Net Income	-1.50B	-1.45B	95.00M	157.90M	322.00M	-126.90M
Balance Sheet
Total Assets	7.57B	7.64B	9.12B	8.59B	7.75B	1.98B
Cash, Cash Equivalents and Short-Term Investments	865.60M	445.00M	393.50M	180.20M	352.20M	366.12M
Total Debt	4.45B	4.14B	4.07B	3.57B	2.95B	880.27M
Total Liabilities	5.09B	5.23B	5.24B	4.82B	4.06B	1.30B
Stockholders Equity	2.48B	2.41B	3.88B	3.77B	3.68B	675.64M
Cash Flow
Free Cash Flow	34.50M	86.60M	-117.30M	-567.40M	-44.02M	188.98M
Operating Cash Flow	313.40M	382.00M	364.70M	-35.10M	278.26M	228.24M
Investing Cash Flow	30.70M	-297.30M	-542.90M	-535.10M	-161.86M	-59.21M
Financing Cash Flow	76.20M	-23.60M	375.80M	425.30M	-124.07M	96.07M

Topgolf Callaway Brands Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 14.68
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

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 14.68 is above the 20-day moving average (MA) of 12.72, above the 50-day MA of 11.70, and above the 200-day MA of 9.16, indicating a bullish trend. The MACD of 0.81 indicates Negative momentum. The RSI at 78.75 is Negative, neither overbought nor oversold. The STOCH value of 93.60 is Negative, 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
YETI	78 Outperform	$3.80B	25.68	21.77%	―	1.56%	-17.21%
GOLF	70 Outperform	$5.36B	24.98	25.91%	1.15%	4.20%	24.12%
OSW	70 Outperform	$2.13B	29.42	13.53%	0.79%	7.27%	45.12%
MODG	62 Neutral	$2.68B	-1.79	-46.95%	―	-3.58%	-12720.97%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
JOUT	60 Neutral	$457.28M	-13.42	-7.78%	3.22%	-0.07%	-31.45%
XPOF	54 Neutral	$390.54M	-4.98	―	―	-3.55%	-111.90%

Topgolf Callaway Brands Corporate Events

Topgolf Callaway Sells Stake, Refocuses on Golf Equipment

On January 1, 2026, Topgolf Callaway Brands completed the sale of a 60% stake in its Topgolf and Toptracer businesses to private equity funds managed by Leonard Green & Partners, valuing Topgolf at about $1.1 billion and generating roughly $800 million in net cash proceeds. In connection with the deal, the parties entered into a new operating agreement for Topgolf’s parent entity that gives Leonard Green majority board representation while preserving consent and consultation rights for Topgolf Callaway Brands as long as it retains specified equity thresholds, and includes transfer restrictions, rights of first offer, tag-along rights and quarterly tax distributions for members. Following the closing, announced on January 5, 2026, the company repaid $1 billion of its term loan B debt, reducing total outstanding debt to about $480 million against roughly $680 million in cash, and its board authorized a new $200 million share repurchase program, underscoring a sharper balance-sheet focus and capital return strategy. The company also said it will change its corporate name back to Callaway Golf Company and its NYSE ticker to CALY in mid-January 2026, signaling a strategic repositioning as a more focused, golf-equipment-centric business while retaining a 40% stake and marketing ties to the Topgolf operations.

The most recent analyst rating on (MODG) stock is a Hold with a $12.00 price target. To see the full list of analyst forecasts on Topgolf Callaway Brands stock, see the MODG Stock Forecast page.

Topgolf Callaway Brands Director Resigns Amid Board Restructuring

On December 2, 2025, C. Matthew Turney resigned as a director of Topgolf Callaway Brands Corp. due to his departure from Dundon Capital Partners, not due to any disagreements with the company. Following his resignation, the board decided to reduce its size to nine directors, while Dundon Capital Partners evaluates its options to appoint a new director under the Stockholders Agreement.

The most recent analyst rating on (MODG) stock is a Hold with a $13.00 price target. To see the full list of analyst forecasts on Topgolf Callaway Brands stock, see the MODG Stock Forecast page.

Topgolf Callaway CEO to Join Jefferies Chat

On November 24, 2025, Topgolf Callaway Brands announced that its President and CEO, Chip Brewer, will participate in a virtual fireside chat hosted by Jefferies analyst Randy Konik on November 25. This event highlights the company’s engagement with investors and stakeholders, potentially impacting its market positioning and investor relations strategy.

The most recent analyst rating on (MODG) stock is a Hold with a $11.50 price target. To see the full list of analyst forecasts on Topgolf Callaway Brands stock, see the MODG Stock Forecast page.

Topgolf Callaway Brands Sells Majority Stake in Topgolf

On November 17, 2025, Topgolf Callaway Brands Corp. announced an agreement to sell a 60% stake in its Topgolf and Toptracer business to Leonard Green & Partners, valuing the business at approximately $1.1 billion. The transaction, expected to close in the first quarter of 2026, will provide Topgolf Callaway Brands with around $770 million in net proceeds. This strategic move aims to enhance shareholder value and support the company’s focus on its core Golf Equipment & Active Lifestyle platform, while retaining a 40% interest in Topgolf to benefit from its future growth.

The most recent analyst rating on (MODG) stock is a Buy with a $14.00 price target. To see the full list of analyst forecasts on Topgolf Callaway Brands stock, see the MODG Stock Forecast page.