Callaway Golf Company (ELY): What Does The Future Look Like?
Callaway Golf Company’s (NYSE:ELY) unpleasant earnings per share drop is expected to be a big double-digit -68.46% over the next three years. At a current EPS of $1.854, this adverse movement means shareholders can expect an impending EPS of $0.585. To assess the reasonability of ELY’s earnings per share contraction, we should look at its most recent growth rate delivered. See our latest analysis for ELY
What can we expect from ELY in the future?
The bad news for investors of ELY is that a drop in earnings is on the cards. Analysts covering the company are expecting the EPS to drop down to $0.585, a significant decline from previous levels of around $1.854. In the same period revenue is predicted to increase from $965M to $1,110M and profits (net income) are predicted to decline from $175M to $55M in the next couple of years. Though, margins are expected to be rather acceptable at 5.04%.
Is the contraction built on solid basis?
The past can be a helpful indicator for future performance for a stock. We can determine whether this level of expected growth is relatively justified or whether the negative sentiment is too pessimistic. ELY is expected to face a significant change from a previous double-digit growth of 53.70%, over the last five years, to a forecast double-digit decline by analysts. This is highly bearish and may be a sign of an investment period for ELY, incurring higher expense growth than revenue.
Next Steps:
For ELY, there are three key aspects you should further research:
1. Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
2. Valuation: What is ELY worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether ELY is currently mispriced by the market.
3. Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of ELY? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
