Pro Analysis

JPMorgan calls Callaway Golf 'compelling', cites market share and innovation

Phil Mickelson's caddie Jim 'Bones' MacKay carries their Callaway bag during the second round of the 109th U.S. Open on the Black Course at Bethpage State Park on June 19, 2009 in Farmingdale, New York.(
Rob Tringali | SportsChrome | Getty Images

Callaway Golf's innovative product portfolio is helping boost the company's market share, which should result in double-digit profit growth through fiscal year 2019, according to JPMorgan, which initiated coverage at overweight.

That, in combination with growing golf participation nationwide, should add up to meaningful upside for investors.

"Under the leadership of CEO Chip Brewer, Callaway has capitalized on golf industry disruption by investing heavily in R&D and technology, improving brand marketing, and launching innovative products to take market share," wrote analyst Steven Zaccone on Thursday. "Callaway is now the #1 hard goods manufacturer year to date, and management sees further opportunity for market share gains across all parts of its portfolio, most notably in the balls business with plans to accelerate from 14 to 15 percent market share currently."