# Callaway Golf (CALY.US)

Canonical: https://gigainvestors.com/s/CALY

Analysis as of: 2026-10-16T07:27:13.614Z. Financial observations: FY2005–FY2025.

Listing currency: USD. Reporting currency: USD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: $13.98 per share; close as of 2026-10-15.

Estimated value: low $5.30 per share, central $5.85 per share, high $6.59 per share. Buy at or below the central value $5.85 per share. Valuation as of 2026-10-16T07:27:13.614Z; scenarios are not confidence intervals.

Expected annual return: 5.5% at the stated quote. About 5.5% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: fail

- 3 revenue declines in the last 10 years (informational)

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 2

- Operating margin variation: 3.42×

Chart: Operating margin; fiscal year observations.

- FY2016: 0.05×

- FY2017: 0.09×

- FY2018: 0.11×

- FY2019: 0.09×

- FY2020: 0.04×

- FY2021: 0.07×

- FY2022: 0.06×

- FY2023: 0.06×

- FY2024: -0.30×

- FY2025: 0.06×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- Recent gross margin fell 4.1pp below the typical margin (limit 4pp)

- ROIC, median of available years: 4.5%

- ROIC, second-lowest year: 3.2%

- Typical minus recent gross margin: 4.1 pp

- Typical gross margin (annual median): 46.2%

- Recent gross margin (lower of latest and 3-year median): 42.1%

- Years with nonpositive capital: 0

- Capital spending / revenue: 2.7%

- ROIC including acquisitions, ten-year median: 3.1%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 10.2%

- FY2017: 9.7%

- FY2018: 16.1%

- FY2019: 8.9%

- FY2020: 4.0%

- FY2021: 3.2%

- FY2022: 5.0%

- FY2023: 3.4%

- FY2024: -18.1%

- FY2025: 3.8%

### economics: fail

- owner earnings cash conversion below threshold

- incremental invested capital return below threshold

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: -$897M

- Net income, five-year total: -$834M

- Return on incremental invested capital: 6.9%

- Working capital / revenue, annual change: -0.9 pp

- Working capital / revenue, change between three-year averages: -6.1 pp

- Working capital / revenue, final three-year average: 23.1%

Chart: Owner earnings · five years; fiscal year observations.

- FY2021: $322M

- FY2022: $158M

- FY2023: $22M

- FY2024: -$1.5B

- FY2025: $53M

### management: fail

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 10.2% vs 3.4%

- Per-share earnings: 0.42 to 0.21 (three-year endpoint medians)

- per-share value declined or ends nonpositive

- five-year and ten-year diluted share growth both above threshold

- acquired goodwill and intangibles (proxy) exceeds half of ten-year net income with low and deteriorating ROIC

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 8.2%

- Ordinary dilution, 5-year annual growth: 14.5%

- Market cap gain: $1.1B

- Cumulative retained earnings: -$1.2B

- Diluted shares, 10-year annual growth: 8.2%

- Diluted shares, 5-year annual growth: 14.5%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: -8.4%

- Per-share value change: -$0.21

- Per-share value, starting three-year median: $0.42

- Per-share value, ending three-year median: $0.21

- Buybacks concentrated in cheaper years (correlation): -0.30

- Average buyback yield: 1.1%

- Buyback history: 10 years

- Debt-funded buybacks: No

- Acquisition spending: $3.5B

- Cumulative net income, 10 years: -$546M

- ROIC, first three-year median: 10.2%

- ROIC, last three-year median: 3.4%

Chart: Earnings per share; fiscal year observations.

- FY2016: $1.98

- FY2017: $0.42

- FY2018: $1.08

- FY2019: $0.82

- FY2020: -$1.35

- FY2021: $1.82

- FY2022: $0.78

- FY2023: $0.47

- FY2024: -$7.26

- FY2025: $0.21

### accounting: pass

- Sloan accruals: -4.1%

- Receivables to sales index (DSRI): 1.18×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 7.1%

- Earnings backed by cash: Yes

- Operating cash / earnings: 8.61×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.41×

Chart: Sloan accruals; fiscal year observations.

- FY2016: 14.0%

- FY2017: -7.8%

- FY2018: 1.2%

- FY2019: -0.4%

- FY2020: -17.9%

- FY2021: 0.6%

- FY2022: 2.2%

- FY2023: -3.0%

- FY2024: -24.0%

- FY2025: -4.1%

## Holders

- [Dan Davidowitz](https://gigainvestors.com/pcm): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Down 49% since Dec 2021 · "Callaway forecasts $2.045B-$2.070B 2026 net sales and $246M-$260M adjusted EBITDA amid revised tariff assumptions" (seekingalpha.com, Aug 2026) · sales -51.4%

Story as of 2026-10-16T09:58:27.398Z; price observation 2026-10-15.

Price needs cash profits to grow 13.8% a year for ten years

- 2026-05-08: Callaway forecasts $2.015B-$2.070B in 2026 net sales as tariff outlook improves ([seekingalpha.com](https://seekingalpha.com/news/4589376-callaway-forecasts-2_015b-2_070b-in-2026-net-sales-as-tariff-outlook-improves?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

- 2026-08-05: Callaway forecasts $2.045B-$2.070B 2026 net sales and $246M-$260M adjusted EBITDA amid revised tariff assumptions ([seekingalpha.com](https://seekingalpha.com/news/4625624-callaway-forecasts-2_045b-2_070b-2026-net-sales-and-246m-260m-adjusted-ebitda-amid-revised?utm_source=feed_news_all&utm_medium=referral&feed_item_type=news))

### Sales · FY2024–2025

sales -51.4%; source https://www.sec.gov/Archives/edgar/data/837465/000083746526000010/modg-20251231.htm; observed 2026-02-27.

- FY2016: $872M 

- FY2017: $1.0B 

- FY2018: $1.2B 

- FY2019: $1.7B 

- FY2020: $1.6B 

- FY2021: $3.1B 

- FY2022: $4.0B 

- FY2023: $4.3B 

- FY2024: $4.2B 

- FY2025: $2.1B 

### Gross margin · FY2025

gross margin 42.1%; source https://www.sec.gov/Archives/edgar/data/837465/000083746526000010/modg-20251231.htm; observed 2026-02-27.

- FY2016: 44.4% 

- FY2017: 45.8% 

- FY2018: 46.5% 

- FY2019: 45.1% 

- FY2020: 41.3% 

- FY2021: 59.5% 

- FY2022: 60.3% 

- FY2023: 61.9% 

- FY2024: 62.5% 

- FY2025: 42.1% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in leisure; annual sales are USD 2.1 billion.

- Source: https://www.sec.gov/Archives/edgar/data/837465/000083746526000010/modg-20251231.htm (filed 2026-02-27); FY2025: revenue 2060100000; grossProfit 867600000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-15); CALY.US: Callaway Golf Company designs, manufactures, and sells golf equipment, golf and lifestyle apparel, and other accessories in the United States, Europe, Asia, and Internationally. It operates in two business segments: Golf Equipment; and Apparel, Gear and Other. The company provides drivers, fairway woods, hybrids, irons, and wedges under the Callaway brands; packaged sets under the Callaway and Strata brands; and putters under Odyssey brand. It designs, manufactures, and sells golf clubs, golf balls, apparel, bags, and other accessories under TravisMathew and OGIO brand. It sells its products through golf retailers, sporting goods retailers, online retailers, mass merchants, department stores, third-party distributors, and merchants, and directly to consumers through its retail stores and websites. The company was formerly known as Topgolf Callaway Brands Corp. and changed its name to Callaway Golf Company in January 2026. The company was incorporated in 1982 and is headquartered in Carlsbad, California.

### Why customers stay

Margins ranged from 42.1% to 62.5% during 2023–25; it earns 4.5% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2023: grossProfit / revenue = 61.9%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2024: grossProfit / revenue = 62.5%.

- Source: https://www.sec.gov/Archives/edgar/data/837465/000083746526000010/modg-20251231.htm (filed 2026-02-27); FY2025: grossProfit / revenue = 42.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); 10-year return on capital observations [[2016,0.10153514209525798],[2017,0.09661653145084817],[2018,0.16136777454144693],[2019,0.08926937558650147],[2020,0.04033649721432718],[2021,0.03215166956319243],[2022,0.04959539581683694],[2023,0.03426010002738502],[2024,-0.18095800309738544],[2025,0.03750675675675676]]; median 0.044965946515582056. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Where the cash goes

Paid dividends in 6 of 10 years; bought back USD 3.7 million of shares.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2016: growth capex 0; upkeep 16152000; owner earnings 190333999. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2017: growth capex 8598000; upkeep 17605000; owner earnings 40806000. Growth capex / owner earnings = 0.21070430818997207.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2018: growth capex 12897538.956579078; upkeep 23927461.043420922; owner earnings 100760538.95657907. Growth capex / owner earnings = 0.12800188536245363.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2019: growth capex 0; upkeep 54702000; owner earnings 90549999. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2021: growth capex 166474000; upkeep 155800000; owner earnings 322000000. Growth capex / owner earnings = 0.517.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2022: growth capex 339500000; upkeep 192800000; owner earnings 157900000. Growth capex / owner earnings = 2.150094996833439.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); FY2023: growth capex 169550532.13920075; upkeep 312449467.86079925; owner earnings 22250532.139200747. Growth capex / owner earnings = 7.620066391153336.

- Source: https://www.sec.gov/Archives/edgar/data/837465/000083746526000010/modg-20251231.htm (filed 2026-02-27); FY2025: growth capex 0; upkeep 32600000; owner earnings 52600000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); Dividend observations: [[2016,3764000],[2017,3773000],[2018,3788000],[2019,3776000],[2020,1891000],[2021,3000],[2022,0],[2023,0],[2024,0],[2025,0]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/837465/000083746526000010/modg-20251231.htm (filed 2026-02-27); FY2025: cash repurchases 3700000 USD.

### Are managers owners

Insiders own 13.3% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-15); CALY.US SharesStats.PercentInsiders = 13.318 percentage points; cache date 2026-10-15.

### What the price says

The price assumes cash profits grow 13.8% yearly over ten years; actual growth was 3.1%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-27); Ten-year compound average after fade. Initial solved rate 0.18580988984126923. Price 13.98; FX 1; discount 0.1; same standard ten-year fade to terminal 0.03. FY2015 owner earnings/share 0.20775076526692746 → FY2025 0.2832525578890684. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $10.21 per share

- 2016-11: $12.15 per share

- 2016-12: $10.96 per share

- 2017-01: $11.33 per share

- 2017-02: $10.11 per share

- 2017-03: $11.07 per share

- 2017-04: $11.85 per share

- 2017-05: $12.74 per share

- 2017-06: $12.78 per share

- 2017-07: $12.73 per share

- 2017-08: $13.94 per share

- 2017-09: $14.43 per share

- 2017-10: $14.43 per share

- 2017-11: $14.51 per share

- 2017-12: $13.93 per share

- 2018-01: $14.77 per share

- 2018-02: $15.48 per share

- 2018-03: $16.36 per share

- 2018-04: $17.26 per share

- 2018-05: $18.94 per share

- 2018-06: $18.97 per share

- 2018-07: $19.24 per share

- 2018-08: $22.81 per share

- 2018-09: $24.29 per share

- 2018-10: $21.40 per share

- 2018-11: $17.13 per share

- 2018-12: $15.30 per share

- 2019-01: $16.29 per share

- 2019-02: $17.21 per share

- 2019-03: $15.93 per share

- 2019-04: $17.56 per share

- 2019-05: $14.70 per share

- 2019-06: $17.16 per share

- 2019-07: $18.34 per share

- 2019-08: $17.76 per share

- 2019-09: $19.41 per share

- 2019-10: $20.22 per share

- 2019-11: $20.78 per share

- 2019-12: $21.20 per share

- 2020-01: $21.42 per share

- 2020-02: $16.98 per share

- 2020-03: $10.22 per share

- 2020-04: $14.32 per share

- 2020-05: $15.32 per share

- 2020-06: $17.51 per share

- 2020-07: $19.05 per share

- 2020-08: $20.86 per share

- 2020-09: $19.14 per share

- 2020-10: $15.49 per share

- 2020-11: $21.25 per share

- 2020-12: $24.01 per share

- 2021-01: $27.89 per share

- 2021-02: $27.95 per share

- 2021-03: $26.75 per share

- 2021-04: $28.95 per share

- 2021-05: $36.92 per share

- 2021-06: $33.73 per share

- 2021-07: $31.68 per share

- 2021-08: $28.06 per share

- 2021-09: $27.63 per share

- 2021-10: $27.05 per share

- 2021-11: $26.96 per share

- 2021-12: $27.44 per share

- 2022-01: $23.86 per share

- 2022-02: $24.74 per share

- 2022-03: $23.42 per share

- 2022-04: $21.94 per share

- 2022-05: $21.71 per share

- 2022-06: $20.40 per share

- 2022-07: $22.95 per share

- 2022-08: $22.13 per share

- 2022-09: $19.26 per share

- 2022-10: $18.72 per share

- 2022-11: $20.95 per share

- 2022-12: $19.75 per share

- 2023-01: $24.49 per share

- 2023-02: $23.18 per share

- 2023-03: $21.62 per share

- 2023-04: $22.17 per share

- 2023-05: $17.07 per share

- 2023-06: $19.85 per share

- 2023-07: $19.97 per share

- 2023-08: $17.44 per share

- 2023-09: $13.84 per share

- 2023-10: $12.22 per share

- 2023-11: $12.26 per share

- 2023-12: $14.34 per share

- 2024-01: $13.17 per share

- 2024-02: $14.24 per share

- 2024-03: $16.17 per share

- 2024-04: $16.02 per share

- 2024-05: $15.65 per share

- 2024-06: $15.30 per share

- 2024-07: $16.50 per share

- 2024-08: $10.06 per share

- 2024-09: $10.98 per share

- 2024-10: $9.71 per share

- 2024-11: $8.42 per share

- 2024-12: $7.86 per share

- 2025-01: $7.86 per share

- 2025-02: $6.53 per share

- 2025-03: $6.59 per share

- 2025-04: $6.61 per share

- 2025-05: $6.34 per share

- 2025-06: $8.05 per share

- 2025-07: $9.25 per share

- 2025-08: $9.56 per share

- 2025-09: $9.50 per share

- 2025-10: $9.41 per share

- 2025-11: $12.88 per share

- 2025-12: $11.67 per share

- 2026-01: $14.35 per share

- 2026-02: $14.06 per share

- 2026-03: $13.88 per share

- 2026-04: $15.30 per share

- 2026-05: $15.40 per share

- 2026-06: $18.79 per share

- 2026-07: $18.46 per share

- 2026-08: $15.71 per share

- 2026-09: $14.09 per share

- 2026-10: $13.98 per share

## Annual estimated value (USD per share)

- FY2016: low $3.20 per share, central $3.49 per share, high $3.87 per share

- FY2017: low $4.21 per share, central $4.70 per share, high $5.35 per share

- FY2018: low $5.84 per share, central $6.59 per share, high $7.59 per share

- FY2019: low $11.30 per share, central $13.08 per share, high $15.08 per share

- FY2020: low $13.37 per share, central $14.72 per share, high $16.52 per share

- FY2021: low $12.32 per share, central $14.26 per share, high $16.32 per share

- FY2022: low $12.92 per share, central $15.76 per share, high $18.30 per share

- FY2023: low $11.71 per share, central $14.40 per share, high $16.56 per share

- FY2024: low $3.01 per share, central $3.18 per share, high $3.40 per share

- FY2025: low $7.74 per share, central $8.16 per share, high $8.73 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/837465/000083746526000010/modg-20251231.htm); period 2025-12-31, filed 2026-02-27.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.