Value
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 7.0 |
| P/S | 9.4 |
| EV/EBITDA | 5.0 |
| Fwd P/E | 7.0 |
| PEG | 10.0 |
| Analyst target | 6.0 |
- ▸Forward P/E: 17.9x
- ▸PEG: 0.01
- ▸Attractively valued
CALY · Why this verdict
Why Callaway Golf (CALY) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
Show full disclosure ▾Hide full disclosure ▴
About TrendMatrix. TrendMatrix is a publisher of general securities research and market commentary. We publish on a regular schedule. All content is the same for every subscriber in a tier — we do not provide personalized investment advice and we do not take into account any individual subscriber's financial situation, investment objectives, risk tolerance, tax situation, or holdings.
Not investment advice. TrendMatrix is not a registered investment adviser. Our content is for informational and educational purposes only. Consult your own licensed investment adviser, broker, or tax professional before making any investment decision.
Conflicts and positions. People who build TrendMatrix, or entities they control, may hold positions, long or short, in securities it covers, and may trade them at any time. Positions are not disclosed individually. Verdicts are generated by an automated model applied by the same rules to every covered stock, and are not adjusted for any position held by the people who build TrendMatrix. We do not accept payment from issuers for coverage.
No paid promotion. TrendMatrix does not accept payment from any issuer, broker, or third party in exchange for coverage of any security.
No fiduciary duty. No fiduciary, advisory, or agency relationship is created between you and TrendMatrix by reading our content or subscribing to our service.
Performance. Past performance is not indicative of future results. Performance figures reflect the published model only and do not reflect any individual subscriber's actual results.
VerdictSELL
Overall score5.9/10
ConfidenceHIGH
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Callaway Golf has a perfect four-quarter beat streak, a strong Piotroski score and about 17.1% upside to target, but earnings arrive in 4 days and quality is only middling.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The Piotroski score is 9/9 but free-cash-flow margin is only 4% with a yield of 3.5%. Quality breakdown | FCF margin rises above 6%. | →Stable |
| CounterModerate margins leave little buffer in a consumer downturn. | ||
Callaway beat EPS estimates in 4 of 4 quarters with an average surprise of about 33%. Earnings | EPS keeps beating consensus. | →Stable |
| CounterEarnings are in 4 days and a miss would end the streak. | ||
Forward P/E is 17.1x with analyst upside of 35% and about 17.1% to the adjusted target. Sentiment breakdown | Price moves toward the target. | ↑Improving |
| CounterGolf is a discretionary category that is exposed to a consumer slowdown. | ||
RSI is 73 in a bear rally, with price below the 200-day average whose slope is still rising 2.0%. Momentum breakdown | Price clears the 200-day average. | →Stable |
| CounterOverbought bounces below the long-term average often fail. | ||
The Piotroski score is 9/9 but free-cash-flow margin is only 4% with a yield of 3.5%.
→StableQuality breakdown
- Expectation
- FCF margin rises above 6%.
CounterModerate margins leave little buffer in a consumer downturn.
Callaway beat EPS estimates in 4 of 4 quarters with an average surprise of about 33%.
→StableEarnings
- Expectation
- EPS keeps beating consensus.
CounterEarnings are in 4 days and a miss would end the streak.
Forward P/E is 17.1x with analyst upside of 35% and about 17.1% to the adjusted target.
↑ImprovingSentiment breakdown
- Expectation
- Price moves toward the target.
CounterGolf is a discretionary category that is exposed to a consumer slowdown.
RSI is 73 in a bear rally, with price below the 200-day average whose slope is still rising 2.0%.
→StableMomentum breakdown
- Expectation
- Price clears the 200-day average.
CounterOverbought bounces below the long-term average often fail.
Per-dimension breakdown
Quality
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.2 |
| ROA | 1.6 |
| Gross margin | 4.9 |
| Op margin | 6.9 |
| Net margin | 0.0 |
| Current ratio | 10.0 |
| FCF quality | 4.4 |
| Moat | 6.0 |
| Piotroski F | 10.0 |
- ▸FCF-positive but moderate margins (FCF margin 4%, FCF yield 3.3%)
- ▸Strong Piotroski F-Score: 9/9
Growth
6.5/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.0 |
| EPS growth | 10.0 |
Momentum
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.0 |
| MACD | 10.0 |
| OBV | 4.8 |
| MA position | 9.0 |
| Volume | 4.0 |
- ▸Overbought (RSI 80)
- ▸Above 200-day MA
Sentiment
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.0 |
| Price target | 8.5 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (10.0) — signal dampened
- ▸Analyst upside: 28%
Insider
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 9.9 |
| notable moves | 7.0 |
- ▸Modest insider selling — $1,800,478 (0.063% of mkt cap)
- ▸Institutions accumulating
Peer rank
3.9/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.3 |
| quality rank | 0.9 |
| growth rank | 2.9 |
Technical
2.4/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 1.5 |
| 52w position | 5.7 |
Risk (lower is worse)
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.2 |
| days to cover | 7.5 |
| volatility | 5.6 |
| put call | 0.0 |
| implied vol | 1.5 |
| beta | 7.1 |
| debt equity | 9.5 |
- ▸Elevated put/call: 2.00
- ▸High IV: 71%
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Perfect beat streak: 4Q
- ▸Earnings in 1 day
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- MOMENTUM:6.4>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- ASYMMETRY:0.8<1.5@spot
- EARNINGS_PROXIMITY:1d<=7d
Warning (0)
none
Reward-to-Risk
0.78
Upside
+11.8%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $2.9B<$5B
Investment implication
The F-path SELL output reflects an overall score of 3.9 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 7.5) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:0.8<1.5@spot, EARNINGS_PROXIMITY:1d<=7d) reinforce the read. Current asymmetry R:R is 0.78 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 7.5, Catalyst at 7.5, and Sentiment at 6.9; the weakest are Technical at 2.4, Peer rank at 3.9, and Quality at 5.0. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of 0.78 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Perfect Beat Streak
Trip ifEPS surprise stays below 0% for 2 consecutive quarters.
- P2Valuation Upside
Trip ifUpside to the analyst target falls below 8% from the current 17.1%.
- P3Moderate Margins Strong Piotroski
Trip ifFCF margin falls below 2% from the current 4%.
- P4Overbought Bounce
Trip ifRSI stays above 70 while price remains below the 200-day average for 3 weeks.