Topgolf Callaway Brands Corp. (MODG)
Valuation Overview•Is Topgolf Callaway Brands Corp. Overvalued or Undervalued?
Trading at a relative discount to industry peers, suggesting a specific risk premium is applied.
Fragile underlying quality score of 36/100; weak margins or elevated debt leverage warrant caution.
Analysts remain bullish, forecasting further upside expansion with consensus targets suggesting solid gains.
Verdict: Mixed fundamental profile with offsetting strengths and weaknesses.
Wall Street is highly bullish, projecting significant upside alongside robust expected earnings growth. However, capital return yields remain modest, driven predominantly by aggressive share repurchases.
Returns capital exclusively via buybacks — no active dividend
MODG struggles with subpar profitability and pressured margins. This is paired with a moderately leveraged but stable balance sheet.
The company demonstrates solid revenue growth (10.6% 3Y CAGR) paired with stable bottom-line earnings. However, profitability remains a major concern with severely compressed operating margins (-31.0%).
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $934.0M | -1.1% | +10.6% | +20.0% | +16.9% | |
| EBITDA | $93.8M | — | — | — | — | |
| Net Income | -$14.7M | -1623.9% | — | — | — | |
| EPS (Diluted) | $-0.08 | -1776.6% | — | — | — | |
| Free Cash Flow | $162.1M | +173.8% | — | +22.1% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 64.6% | 61.6% | 57.1% | 51.0% |
| Operating Margin | -31.0% | -5.9% | -3.6% | 1.6% |
| Net Margin | -37.1% | -9.3% | -5.1% | 1.5% |
| FCF Margin | 0.8% | -5.0% | -0.9% | 2.0% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q1'26Latest | $-0.42 | $-0.33 | +22.2% | ||
| Q4'25 | $-0.21 | $-0.05 | +76.2% | ||
| Q3'25 | $0.03 | $0.24 | +700.0% | ||
| Q2'25 | $-0.04 | $0.11 | +375.0% | ||
| Q1'25 | $-0.40 | $-0.33 | +17.5% | ||
| Q4'24 | $-0.18 | $0.02 | +111.1% | ||
| Q3'24 | $0.27 | $0.42 | +55.6% | ||
| Q2'24 | $0.01 | $0.09 | +554.5% |
Total return is +50.6% (1Y), outperforming the benchmark by +25.6%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +7.4% | -1.9% | — |
| 1Y | +50.6% | +25.6% | — |
| 3YCAGR | -12.9% | -32.4% | — |
| 5YCAGR | -17.0% | -30.1% | — |
| 10YCAGR | +2.1% | -11.3% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about Topgolf Callaway Brands Corp. (MODG) valuation, health, and returns.
Topgolf Callaway Brands Corp. is estimated to be fairly valued under our discounted cash flow framework. relative multiples indicate the stock is Limited: Cheap versus peers compared to industry peers. trading near fair value (DCF: $0.00)
Topgolf Callaway Brands Corp. has multiple valuation anchors: DCF Intrinsic Value: $0.00 | Peer Relative Fair Value: $17.30 | Wall Street Analyst Target: $16.50 (implying +31.1% upside). A convergence of these signals offers higher conviction.
Topgolf Callaway Brands Corp. displays weak financial health with a composite quality score of 36/100, supported by a Altman Z-Score of -0.4 (distress zone), Piotroski F-Score of 6/9, Return on Invested Capital (ROIC) of -13.8%.
Topgolf Callaway Brands Corp. returns capital via buybacks instead of dividends, carrying a 1.4% buyback yield and reducing outstanding shares by -8.7% in the last 12 months.
Topgolf Callaway Brands Corp.'s current growth trajectory is Decelerating. The company achieved -1.1% 1Y revenue growth and -1776.6% 1Y EPS growth, compared to its 3Y revenue CAGR of +10.6%.
Wall Street consensus is Buy based on 23 analysts, beating EPS expectations in 100% of recent quarters with a 12-quarter streak. The consensus price target represents a +31.1% change from current levels.
Investment risks for Topgolf Callaway Brands Corp. include: -20.4% 1-year max drawdown, high beta (1.92x market volatility), elevated distress risk. Volatility risk is characterized by a beta of 1.92x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.