Shares of Callaway Golf Co. climbed Friday after the golf equipment maker reported 21 percent growth in first-quarter profit, narrowly beating analyst estimates.
However, the company warned that its full-year earnings and sales will likely fall toward the low end of its previously issued guidance range.
Late Thursday, Callaway said net income for the period ended March 31 increased to $39.7 million, or 61 cents per share, from $32.8 million, or 48 cents per share, in the year-ago period.
Sales grew 10 percent to $366.5 million from $334.6 million.
Analysts surveyed by Thomson Financial predicted earnings of 60 cents per share on revenue of $361.7 million.
Carlsbad, Calif.-based Callaway said its full-year results will likely come in at the low end of its previous guidance for 2008 revenue between $1.15 billion and $1.17 billion and earnings per share between $1.08 and $1.18.
Analysts expect 2008 profit of $1.12 per share on sales of $1.16 billion.
Rommel Dionisio of Wedbush Morgan Securities was impressed with Callaway's 21 percent international growth during the quarter. He noted the segment makes up 47 percent of total sales.
"Sales in Europe and Japan were both above plan, driven by solid sales of new fairway wood models and putters," the analyst wrote in a client note.
Dionisio reaffirmed a "Buy" rating and $18 price target.
John Shanley of Susquehanna Financial Group was pleased with Callaway's quarterly performance, but he remained concerned about full-year sales, saying a slowdown in consumer discretionary spending could hurt second-quarter reorder levels.
Many industries, such as leisure and retail, have been squeezed as consumers tighten spending due to the continued housing slowdown, diminishing credit, rising food and gas costs and recession fears.
The analyst maintained a "Neutral" rating and cut his 2008 profit forecast to $1.10 per share from $1.12 per share.
Callaway Golf's stock added 26 cents to $14.23 in afternoon trading Friday.
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