Reviewing Topgolf Callaway Brands (NYSE:MODG) and Academy Sports and Outdoors (NASDAQ:ASO)

Topgolf Callaway Brands (NYSE:MODG) and Academy Sports and Outdoors (NASDAQ:ASO) are both mid-cap consumer discretionary companies, but which is the better stock? We will contrast the two companies based on the strength of their valuation, institutional ownership, risk, earnings, analyst recommendations, dividends and profitability.

Analyst Ratings

This is a breakdown of recent ratings for Topgolf Callaway Brands and Academy Sports and Outdoors, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Topgolf Callaway Brands	1	6	4	0	2.27
Academy Sports and Outdoors	0	10	10	0	2.50

Topgolf Callaway Brands currently has a consensus price target of $12.94, indicating a potential downside of 11.28%. Academy Sports and Outdoors has a consensus price target of $59.89, indicating a potential upside of 2.27%. Given Academy Sports and Outdoors’ stronger consensus rating and higher probable upside, analysts plainly believe Academy Sports and Outdoors is more favorable than Topgolf Callaway Brands.

Profitability

This table compares Topgolf Callaway Brands and Academy Sports and Outdoors’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Topgolf Callaway Brands	-37.06%	-0.13%	-0.04%
Academy Sports and Outdoors	6.27%	18.24%	7.18%

Earnings & Valuation

This table compares Topgolf Callaway Brands and Academy Sports and Outdoors”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Topgolf Callaway Brands	$4.24 billion	0.63	-$1.45 billion	($8.19)	-1.78
Academy Sports and Outdoors	$6.01 billion	0.65	$418.45 million	$5.47	10.71

Academy Sports and Outdoors has higher revenue and earnings than Topgolf Callaway Brands. Topgolf Callaway Brands is trading at a lower price-to-earnings ratio than Academy Sports and Outdoors, indicating that it is currently the more affordable of the two stocks.

Insider and Institutional Ownership

84.7% of Topgolf Callaway Brands shares are held by institutional investors. 2.4% of Topgolf Callaway Brands shares are held by company insiders. Comparatively, 3.6% of Academy Sports and Outdoors shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company will outperform the market over the long term.

Volatility & Risk

Topgolf Callaway Brands has a beta of 0.92, indicating that its share price is 8% less volatile than the S&P 500. Comparatively, Academy Sports and Outdoors has a beta of 1.26, indicating that its share price is 26% more volatile than the S&P 500.

Summary

Academy Sports and Outdoors beats Topgolf Callaway Brands on 13 of the 14 factors compared between the two stocks.

About Topgolf Callaway Brands

Topgolf Callaway Brands Corp. designs, manufactures, and sells golf equipment, golf and lifestyle apparel, and other accessories in the United States, Europe, Asia, and Internationally. The Topgolf segment operates Topgolf venues equipped with technology-enabled hitting bays, bars, dining areas, and event spaces, as well as Toptracer ball-flight tracking technology; and World Golf Tour digital golf game. The Golf Equipment segment provides drivers, fairway woods, hybrids, irons, wedges and packaged sets, putters, and pre-owned golf clubs under the Callaway and Odyssey brands, as well as golf balls under the Callaway Golf and Strata brands. The Active Lifestyle segment offers golf apparel and footwear; golf accessories, including golf bags, golf gloves, headwear, and practice aids under the Callaway brand; golf and lifestyle apparel, hats, luggage, and accessories under the TravisMathew brand; and footwear, belts, hats, facemasks, sunglasses, socks, and underwear under the Cuater by TravisMathew brand. This segment also provides storage and travel gear for sport and personal use, such as backpacks; travel, duffel, and golf bags; and storage gear accessories, as well as outerwear, headwear, and accessories under the OGIO brand. In addition, it offers outdoor apparel comprising jackets, trousers, dresses, skirts, and tops; and footwear and outdoor equipment, including packs and bags, travel bags, tents, sleeping bags, and accessories under the Jack Wolfskin brand. The company sells its products through golf retailers, sporting goods retailers, online retailers, mass merchants, department stores, third-party distributors, and mail order stores, as well as directly to consumers through its retail stores and websites. The company was formerly known as Callaway Golf Company and changed its name to Topgolf Callaway Brands Corp. in September 2022. Topgolf Callaway Brands Corp. was incorporated in 1982 and is headquartered in Carlsbad, California.

About Academy Sports and Outdoors

Academy Sports and Outdoors, Inc., through its subsidiaries, operates as a sporting goods and outdoor recreational retailer in the United States. The company outdoor division comprises camping products, such as coolers and drinkware, and camping accessories and equipment,; fishing products, including marine equipment and fishing rods, reels, and baits and equipment; and hunting products, which includes firearms, ammunition, archery and archery equipment, camouflage apparel, waders, shooting accessories, gun safes, optics, airguns, and hunting equipment. Its sports and recreation division offers fitness equipment, fitness accessories, and nutrition supplies; team and specialty sports equipment, including baseball, football, basketball, soccer, golf, racket sports, volleyball, backpacks, and sports bags; recreation products, which includes patio furniture, outdoor cooking, trampolines, play sets, watersports, and pet equipment, as well as wheeled goods including bicycles, skateboards, and other ride-on toys; and electronics and watches, as well as front-end products, such as consumables, batteries, etc. The company's apparel division provides outdoor and seasonal apparel, denim, work apparel, graphic t-shirts, and accessories; boys and girls outdoor, and athletic apparel; sporting and fitness apparel; and professional and collegiate team licensed apparel and accessories. Its footwear division offers casual shoes, slippers, seasonal footwear, and socks; work and western boots, shoes, and hunting footwear; boys and girls footwear; athletic footwear, such as running shoes, athletic lifestyle, and training shoes; and team and specialty sports footwear, and slides. The company sells its products under the Academy Sports + Outdoors, Magellan Outdoors, BCG, O'rageous, Game Winner, Outdoor Gourmet, and Freely brand names. Academy Sports and Outdoors, Inc. was founded in 1938 and is headquartered in Katy, Texas.