MMSC - Top Golf's Wide Moat Gives Callaway Upside

May, 11 2022 04:58 PM First Trust Multi-Manager Small Cap Opportunities ETF

Callaway is an industry leader in golf equipment, apparel, and family entertainment.
ELY had a strong start to FY22, with Q1 earnings having an EPS beat of 33%.
Top Golf is the only family entertainment experience of its kind with a wide moat.
Using very conservative estimates, a valuation of ELY's assets indicates that investors are not paying for 37% of Top Golf, implying that shareholders are receiving $479.15 million in free revenue.
Assuming conservative estimates for FY22/FY23 and CAGR of 10% for FY24/FY25, my DCF model arrived at an intrinsic value of $24.61 (36.97% upside).

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Company Name:	First Trust Multi-Manager Small Cap Opportunities ETF
Stock Symbol:	MMSC
Market:	NYSE