The 10-second takeaway
For the quarter ended March 31 (Q1), Callaway Golf missed estimates on revenue and missed estimates on earnings per share.
Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share expanded significantly.
Gross margin contracted, operating margin contracted, and net margin expanded.
Callaway Golf logged revenue of $285.1 million. The seven analysts polled by S&P Capital IQ hoped for revenue of $309.5 million on the same basis. GAAP reported sales were 0.2% lower than the prior-year quarter's $285.6 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.18. The seven earnings estimates compiled by S&P Capital IQ predicted $0.22 per share. GAAP EPS of $0.37 for Q1 were 147% higher than the prior-year quarter's $0.15 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 43.6%, 190 basis points worse than the prior-year quarter. Operating margin was 9.8%, 50 basis points worse than the prior-year quarter. Net margin was 11.2%, 670 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $312.9 million. On the bottom line, the average EPS estimate is $0.22.
Next year's average estimate for revenue is $980.3 million. The average EPS estimate is $0.12.
The stock has a two-star rating (out of five) at Motley Fool CAPS. Among 70 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 56 give Callaway Golf a green thumbs-up, and 14 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Callaway Golf is outperform, with an average price target of $8.67.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.