Contrasting YETI (NYSE:YETI) and Topgolf Callaway Brands (NYSE:CALY)

Topgolf Callaway Brands (NYSE:CALY) and YETI (NYSE:YETI) are both mid-cap consumer discretionary companies, but which is the better investment? We will compare the two businesses based on the strength of their dividends, valuation, institutional ownership, earnings, analyst recommendations, risk and profitability.

Risk and Volatility

Topgolf Callaway Brands has a beta of 0.93, suggesting that its stock price is 7% less volatile than the S&P 500. Comparatively, YETI has a beta of 1.7, suggesting that its stock price is 70% more volatile than the S&P 500.

Institutional & Insider Ownership

84.7% of Topgolf Callaway Brands shares are owned by institutional investors. 2.9% of Topgolf Callaway Brands shares are owned by insiders. Comparatively, 1.5% of YETI shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Valuation and Earnings

This table compares Topgolf Callaway Brands and YETI”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Topgolf Callaway Brands	$2.06 billion	1.34	-$409.30 million	$0.43	36.03
YETI	$1.87 billion	1.57	$165.39 million	$2.29	17.59

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

Analyst Ratings

This is a breakdown of recent ratings and target prices for Topgolf Callaway Brands and YETI, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Topgolf Callaway Brands	0	5	3	0	2.38
YETI	0	6	10	0	2.62

Topgolf Callaway Brands presently has a consensus target price of $20.17, suggesting a potential upside of 30.15%. YETI has a consensus target price of $55.57, suggesting a potential upside of 37.97%. Given YETI’s stronger consensus rating and higher probable upside, analysts plainly believe YETI is more favorable than Topgolf Callaway Brands.

Profitability

This table compares Topgolf Callaway Brands and YETI’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Topgolf Callaway Brands	3.37%	5.86%	2.48%
YETI	9.24%	23.79%	12.44%

Summary

YETI beats Topgolf Callaway Brands on 10 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 YETI

YETI Holdings, Inc. designs, retails, and distributes products for the outdoor and recreation market under the YETI brand. It offers coolers and equipment, including hard and soft coolers, cargo, bags, outdoor living, and associated accessories, as well as backpacks, duffel bags, luggage, packing cubes, carryalls, camp chairs, blankets, dog beds, dog bowls, and gear cases under the LoadOut, Panga, Crossroads, Camino, Hondo Base, Trailhead, Lowlands, Boomer, and SideKick Dry brands. The company also provides drinkware products, such as colsters, lowballs, wine tumblers, stackable pints, mugs, tumblers, straw mugs and cups, bottles, jugs, and water bottles, as well as accessories comprising bottle straw and chug caps, lids, straw lids, color packs, tumbler handles, and jug mounts under the Rambler brand. In addition, it offers apparel and gear products, such as hats, shirts, bottle openers, and ice substitutes. The company sells its products through independent retailers, including outdoor specialty, hardware, sporting goods, and farm and ranch supply stores, as well as through its Website, YETI.com. It operates in the United States, Canada, Australia, New Zealand, Europe, Hong Kong, China, Singapore, and Japan. YETI Holdings, Inc. was founded in 2006 and is headquartered in Austin, Texas.