“The stock of pure golf here has been obliterated, and if you want to be opportunistic, especially in light of [Masters Tournament]I like Acushnet more than Callaway, at least for the remainder of 2022,mad money‘ said the host.
Many people have turned to golf during the pandemic as a way to stay active but socially distant, which is why leading golf brands are looking forward to seeing it. Increase sales in 2020.
Since then, “Callaway’s stock has fallen more than 40% from its highs last summer. Acushnet is 30% off its peak last November,” Kramer said, though he emphasized that he does not view the stock as playing the pandemic.
Callaway stock fell 0.98% Thursday to $22.19, below a 52-week high of $37.75. Shares of Acushnet, which includes FootJoy and Titleist, fell 0.39% Thursday to $40.74, below a 52-week high of $57.87.
Kramer added that because Acushnet was able to achieve success “Huge sales and earnings growth last year,” despite dealing with supply chain problems, believes the stock is undervalued. “Acushnet is selling for only 15 times its earnings estimates this year. I like it. It’s making it as cheap as it has ever been in the past two years. In short, I think this is a great moment to swing at Acushnet,” Kramer said.
As for Callaway, Cramer said that while the stock is down, he’s reluctant to advise investors to buy the stock in the current market due to his merger with sports entertainment company Topgolf in 2021.
“Callaway is becoming less of a tangible business and more of a concept business,” Kramer said. … All concept stocks became obsolete last November. “It’s hard to say it’s cheap even after such a sinister decline,” he added.
“In the long-term, I think Callaway has a very good growth story. However, it’s probably not a good fit for this market,” he said.
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