“Pure-play golf stocks have been obliterated here, and if you want to be opportunistic, especially in light of the [Masters Tournament], I like Acushnet more than Callaway, at least through the remainder of 2022,” the “Mad Money” host said.
Many people turned to golf during the pandemic as a way to stay active but socially distanced, leading golf brands to see surges in sales in 2020.
Since then, “Callaway’s come down more than 40% from its highs last summer. Acushnet is off 30% from its peak last November,” Cramer said, though he maintained that he does not view the stocks as pandemic plays.
Callaway stock decreased 0.98% on Thursday to $22.19, below its 52-week high of $37.75. Shares of Acushnet, which houses FootJoy and Titleist, dropped 0.39% on Thursday to $40.74, below its 52-week high of $57.87.
Cramer added that because Acushnet managed to deliver “tremendous sales and earnings growth last year,” despite dealing with supply chain problems, he believes the stock is currently undervalued. “Acushnet is selling for only 15 times this year’s earnings estimates. I like that. It makes it as cheap as it’s been at any point in the last two years. In short, I think this is a great moment to take a swing at Acushnet,” Cramer said.
As for Callaway, Cramer said while the stock is down, he’s hesitant to advise investors to buy the stock in the current market because of its merger with sports entertainment company Topgolf in 2021.
“Callaway has become less of a tangible business and more of a conceptual one. … The conceptual stocks all went out of style last November,” Cramer said. “And it’s hard to say that this one’s cheap even after such a vicious decline,” he added.
“Longer-term, I think Callaway’s got a pretty good growth story. That said, it’s probably not the right fit for this market,” he said.
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