GOLF - Callaway's Core Businesses Set For Long-Term Pain - Topgolf A Potential Winner
Recommendation
Callaway (ELY) looks set for a period of low cash flow generation due to changes in the macro-environment. The golf equipment business looks likely to be hit the hardest due to its cyclical attributes. The purchase of JW has added a significant debt load that will sweep up any free cash flow generated over the next few years. Topgolf's shutdown has likely dropped its value by over 50% from its reported IPO prices in January. However, the business concept is still intact and the barriers to entry could lead to sustainable high