Callaway Golf Company
Callaway Golf Company Fundamental Analysis
Callaway Golf Company (ELY) shows weak financial fundamentals with a PE ratio of 119.83, profit margin of 1.06%, and ROE of 1.43%. The company generates $3.1B in annual revenue with weak year-over-year growth of -1.06%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 30.3/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze ELY's fundamental strength across five key dimensions:
Efficiency Score
WeakELY struggles to generate sufficient returns from assets.
Valuation Score
ModerateELY shows balanced valuation metrics.
Growth Score
WeakELY faces weak or negative growth trends.
Financial Health Score
ExcellentELY maintains a strong and stable balance sheet.
Profitability Score
ModerateELY maintains healthy but balanced margins.
Key Financial Metrics
Is ELY Expensive or Cheap?
P/E Ratio
ELY trades at 119.83 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, ELY's PEG of 0.24 indicates potential undervaluation.
Price to Book
The market values Callaway Golf Company at 1.84 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at 13.17 times EBITDA. This signals the market has high growth expectations.
How Well Does ELY Make Money?
Net Profit Margin
For every $100 in sales, Callaway Golf Company keeps $1.06 as profit after all expenses.
Operating Margin
Core operations generate 7.04 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $1.43 in profit for every $100 of shareholder equity.
ROA
Callaway Golf Company generates $1.03 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Callaway Golf Company generates limited operating cash flow of $137.08M, signaling weaker underlying cash strength.
Free Cash Flow
Callaway Golf Company produces free cash flow of $168.46M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.91 in free cash annually.
FCF Yield
ELY converts 4.23% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
119.83
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
0.24
vs 25 benchmark
P/B Ratio
Price to book value ratio
1.84
vs 25 benchmark
P/S Ratio
Price to sales ratio
1.28
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.23
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.28
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.01
vs 25 benchmark
ROA
Return on assets percentage
0.01
vs 25 benchmark
ROCE
Return on capital employed
0.09
vs 25 benchmark
How ELY Stacks Against Its Sector Peers
| Metric | ELY Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 119.83 | 23.71 | Worse (Expensive) |
| ROE | 1.43% | 1187.00% | Weak |
| Net Margin | 1.06% | 2531.00% | Weak |
| Debt/Equity | 0.23 | 0.77 | Strong (Low Leverage) |
| Current Ratio | 2.28 | 2.82 | Strong Liquidity |
| ROA | 1.03% | -8521.00% (disorted) | Weak |
ELY outperforms its industry in 2 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Callaway Golf Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
27.86%
Industry Style: Cyclical, Growth, Discretionary
High GrowthEPS CAGR
-1035.39%
Industry Style: Cyclical, Growth, Discretionary
DecliningFCF CAGR
126.45%
Industry Style: Cyclical, Growth, Discretionary
High Growth