Shaun Currie, CFA
Long/short equity, hedge fund analyst, momentum

Callaway Golf: The First Move In A Larger, Downward Trend

On Tuesday, Dick's Sporting Goods (NYSE:DKS) missed earnings estimates and reduced guidance for the full year, mostly due to an 18% decline in golf sales. When looking through the numbers, we see this as the biggest negative Callaway Golf (NYSE:ELY) could have heard, as 2014 results hinged on a rebound in sales throughout the year. Callaway management noted that the risk for 2014 was increased inventory levels throughout the industry that could be deeply discounted if sales did not rebound. After an impressive Q1, in which the company took significant market share, analysts chose to believe that the company was being conservative, and forecasted earnings much higher than the company's guidance (average analyst estimate going into...

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