Lord Baltimore
Long/short equity, long-term horizon, media, consumer

Take The Mulligan On Callaway Golf While You Can

Callaway Golf (NYSE:ELY) is in the midst of a significant turnaround, which began when new management, led by Chip Brewer, joined the floundering golf equipment company on March 5, 2012. From that date, the stock outperformed the S&P 500 rising 58% (excluding a modest $0.01/share quarterly dividend) through March 31 of this year. Since then the stock has retraced approximately 22% providing investors who "whiffed" earlier an opportunity to take a mulligan and buy the stock at an attractive level. We are long the stock and recommend purchase with a $12 two-year target price.

Before reviewing the turnaround, we first review what has driven the stock to underperform in the past two months and why we believe investors...

Join Seeking Alpha PRO to read this archived article and 11,574 other archived articles
IDEA GENERATORXExclusive access to 10 PRO ideas every day
INVESTING IDEAS LIBRARYXExclusive access to PRO library of more than 15,000 ideas
SECTOR EXPERT NETWORKXExclusive access to all sector experts for direct consultation
PERFORMANCE TRACKINGXTrack performance of all PRO stock ideas
PROFESSIONAL TOOLSXProfessional Idea Filters to zero-in based on industry, market cap and more
"In just the first month of using PRO, I used it to generate two ideas which were actionable for me. As a result of these two positions, I have earned more than 20 times the annual subscription costs for PRO."Michael Yagemann, Greenbridge Capital
"I am pleasantly surprised with the scope of small and mid-cap coverage PRO offers. You can't find that any where else."Patrick Rice, Mainstay Capital Management
You may cancel at any time for any reason, and receive a prompt refund for membership on months paid and not used (max. 6 months). Details