Topgolf Callaway Brands Corp. (MODG) Stock Analysis – 2025
Topgolf Callaway Brands Corp. (MODG) is a globally recognized sports and lifestyle brand primarily engaged in golf equipment, apparel, and sports entertainment. The company is widely known for its Topgolf venues, high-quality Callaway golf products, and sports apparel like TravisMathew and Jack Wolfskin.
In recent years, the company has significantly expanded its revenue streams but also faces challenges in maintaining profitability. Let’s dive deeper into its financial performance.
Market Capitalization & Enterprise Value (EV)
Market Cap: $1.16 Billion
Market capitalization refers to the total value of a company’s outstanding shares. As of now, Topgolf Callaway Brands Corp. has a market cap of $1.16 billion, reflecting its current market valuation.
Enterprise Value (EV): $5.17 Billion
The Enterprise Value (EV), which includes the company’s market cap, debt, and cash, stands at $5.17 billion. This means that the company’s total takeover value is significantly higher than its market capitalization due to its large debt burden.
- ✅ What Does This Mean?
This indicates that while the company has a relatively lower market cap, its large debt is inflating its overall enterprise value.
Shares Outstanding & Share Structure
Shares Outstanding: 183.40 Million
The company currently has 183.40 million shares outstanding in the market. This number shows how many total shares are available for trading.
- ✅ Impact on Investors:
A high number of shares outstanding generally dilutes the company’s Earnings Per Share (EPS), making it harder for the company to increase shareholder value unless earnings grow significantly.
Net Income (Last 12 Months) – Loss of $1.45 Billion
Net Income: -$1.45 Billion (Loss)
The most concerning part of the company’s financials is its Net Income, which currently shows a loss of $1.45 billion in the last 12 months.
Why Is The Company Facing Losses?
- Heavy investments in Topgolf Venues expansion.
- High operating costs and marketing expenses.
- Slow growth in revenue compared to expenses.
- ✅ Is This Temporary?
Yes, the losses are largely due to aggressive expansion and heavy debt burdens. However, once the company stabilizes its Topgolf Venues and revenue stream, profitability could return.
Debt/Equity Ratio: 1.85
What Is Debt/Equity Ratio?
The Debt-to-Equity Ratio (D/E) of Topgolf Callaway is currently at 1.85, which means the company has $1.85 of debt for every $1 of shareholder equity.
- ✅ High D/E Means:
- The company is heavily financed through debt.
- Risk of financial instability increases if revenue slows down.
- Interest payments could hurt profitability.
- ✅ Is It Concerning?
Yes, the high Debt/Equity ratio indicates a highly leveraged company, which can become risky if revenue fails to grow at the expected pace. However, if the Topgolf Venues generate strong revenue in the future, this ratio will improve.
Analyst Consensus – 120.29% Potential Upside
What Analysts Are Saying:
- ✅ Buy Rating: Most analysts have rated this stock as a BUY.
- ✅ 120.29% Upside: Analysts predict the stock could increase by 120.29% from its current levels.
Why Are Analysts Bullish?
- Strong brand power (Topgolf, Callaway, TravisMathew).
- Increasing global demand for golf entertainment.
- Upcoming revenue growth from Topgolf Venues.
Risk:
- High debt and negative net income could slow down growth.
- If expansion plans fail, the company might struggle financially.
Stock Price Change – Down by 54.51% in 52 Weeks
Stock Price Drop: -54.51% in the last 52 weeks
In the past year, the stock has lost over 54% of its value. This massive decline has raised concerns among investors.
Why Did The Stock Fall?
- High debt and low profitability.
- Market concerns over future growth.
- Uncertain economic conditions impacting entertainment venues.
Is This A Good Time To Buy?
- Yes, if you believe the company can turn around its profitability.
- No, if you are looking for short-term gains as the company still has financial challenges.
Should You Buy This Stock or Avoid It?
Why Should You Buy This Stock?
- Strong Brand Portfolio: Callaway, Topgolf, TravisMathew.
- High Future Growth Potential: Once Topgolf Venues stabilize, revenue will skyrocket.
- Analyst Buy Rating: 120.29% upside potential.
- Undervalued Stock: Trading at a much lower value than its enterprise value.
Why Should You Avoid This Stock?
- High Debt: The Debt/Equity ratio of 1.85 is concerning.
- Net Loss: Loss of $1.45 billion in the past 12 months.
- Uncertain Profitability: The company has yet to prove consistent profits.
- Market Sentiment: Investors have lost confidence after the stock dropped 54.51%.
Final Conclusion: Is This Stock Worth Investing In?
My Opinion:–
- 💯 If you are a long-term investor (5+ years), this stock has massive growth potential due to its Topgolf Venues and strong brand portfolio.
- 💸 If you are a short-term investor, avoid it until the company shows consistent profitability.
Key Metrics To Watch:
- ✅ Reduction in Net Loss.
- ✅ Increase in Topgolf Revenue.
- ✅ Reduction in Debt/Equity Ratio.
My Final Rating: Moderate Buy (Long-Term)
- 📈 Upside Potential: 120.29%
- 💵 High Debt Risk: Yes
- 💰 Revenue Growth: Promising
- 🚀 Long-Term Outlook: Positive
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