Top-level corporate insiders such as CEOs and CFOs tend to have the most up-to-date information on their businesses. If they’re buying company stock, it’s generally a sign that the outlook for the stock is attractive.
Here, we are going to highlight buying by top-level insiders at Topgolf Callaway Brands Corp (MODG:US). Topgolf Callaway Brands is a golf and entertainment company. Headquartered in California, it manufactures and sells golf clubs and equipment under the Callaway brand while offering entertainment services through its Topgolf division. The company is listed on the New York Stock Exchange and currently has a market capitalization of approximately $4.04 billion.
Insider Buying at Topgolf Callaway Brands Corp
Our insider transaction data shows that between December 2 and December 5, two insiders at Topgolf Callaway Brands bought stock. Those who bought shares were:
President/CEO Oliver Brewer III (10,000 shares @ $21.59 per share)
CFO Brian Lynch (10,000 shares @ $21.64 per share)
In total, the two insiders spent a little over $400,000 on stock.
This insider buying is notable for two main reasons.
Firstly, the two insiders have been at the business for a long period of time. This means that they are likely to know the company very well. Mr. Brewer III has been President/CEO of the company for the last 10 years and has successfully driven the business forward, embracing technology and introducing positive changes. Meanwhile, Mr. Lynch has been CFO of the business for the last three years. He joined the company back in 1999 as Senior Corporate Counsel.
Secondly, our insider transaction data shows that this is the most significant insider buying at Topgolf Callaway Brands for over a year. The two senior insiders have spent over $400,000 on company stock which suggests that they strongly believe the shares are undervalued currently.
Record Q3 Results
Topgolf Callaway Brands recently produced record Q3 results and raised its full-year guidance for 2022.
The majority of the company’s key metrics improved versus Q3 2021. Consolidated net revenues of $988.5 million were 15.4% up on last year while adjusted EBITDA of $144.4 million was up 4%. On a constant currency basis, it was 22.7% higher.
The company noted that all three segments of the business performed well. Encouragingly, it was able to offset negative foreign exchange movements and cost inflation with improved pricing and efficiencies.
As a result of the strong performance in Q3, full-year revenue guidance was increased to a range of $3,965 million to $3,985 million. Adjusted EBITDA guidance was revised up to between $560 million and $570 million.
"Our record third quarter results underscore the strength of our business and competitive positioning across all segments. The long-term trends driving consumer interest and engagement in the Modern Golf ecosystem continued, highlighted by increased traffic at our Topgolf venues and strong sales in our golf equipment and active lifestyle businesses, including continued brand momentum for both TravisMathew and Jack Wolfskin,” said Mr. Brewer.
Given these strong results, we see the insider buying at Topgolf Callaway Brands as a bullish event.