Topgolf Callaway Brands (NYSE:CALY) & Smith & Wesson Brands (NASDAQ:SWBI) Head-To-Head Survey

Topgolf Callaway Brands (NYSE:CALY) and Smith & Wesson Brands (NASDAQ:SWBI) are both consumer discretionary companies, but which is the superior business? We will contrast the two companies based on the strength of their dividends, earnings, valuation, risk, analyst recommendations, profitability and institutional ownership.

Profitability

This table compares Topgolf Callaway Brands and Smith & Wesson Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Topgolf Callaway Brands	1.05%	4.44%	1.59%
Smith & Wesson Brands	2.24%	3.07%	2.04%

Dividends

Topgolf Callaway Brands pays an annual dividend of $1.57 per share and has a dividend yield of 10.3%. Smith & Wesson Brands pays an annual dividend of $0.52 per share and has a dividend yield of 3.4%. Topgolf Callaway Brands pays out 1,121.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Smith & Wesson Brands pays out 226.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Smith & Wesson Brands has increased its dividend for 4 consecutive years.

Analyst Ratings

This is a summary of current ratings and price targets for Topgolf Callaway Brands and Smith & Wesson Brands, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Topgolf Callaway Brands	0	4	0	0	2.00
Smith & Wesson Brands	0	2	1	0	2.33

Topgolf Callaway Brands currently has a consensus target price of $16.00, indicating a potential upside of 5.06%. Smith & Wesson Brands has a consensus target price of $14.00, indicating a potential downside of 8.74%. Given Topgolf Callaway Brands’ higher probable upside, equities analysts plainly believe Topgolf Callaway Brands is more favorable than Smith & Wesson Brands.

Earnings and Valuation

This table compares Topgolf Callaway Brands and Smith & Wesson Brands”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Topgolf Callaway Brands	$2.12 billion	1.29	-$409.30 million	$0.14	108.78
Smith & Wesson Brands	$474.66 million	1.44	$13.43 million	$0.23	66.70

Smith & Wesson Brands has lower revenue, but higher earnings than Topgolf Callaway Brands. Smith & Wesson Brands 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.

Volatility and Risk

Topgolf Callaway Brands has a beta of 0.95, indicating that its share price is 5% less volatile than the S&P 500. Comparatively, Smith & Wesson Brands has a beta of 0.91, indicating that its share price is 9% less volatile than the S&P 500.

Insider & Institutional Ownership

84.7% of Topgolf Callaway Brands shares are held by institutional investors. Comparatively, 59.3% of Smith & Wesson Brands shares are held by institutional investors. 2.9% of Topgolf Callaway Brands shares are held by insiders. Comparatively, 1.6% of Smith & Wesson Brands shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Summary

Smith & Wesson Brands beats Topgolf Callaway Brands on 9 of the 17 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 Smith & Wesson Brands

Smith & Wesson Brands, Inc. is a holding company, which engages in the manufacture, design, and provision of firearms. Its portfolio includes handguns, long guns, handcuffs, suppressor, and other firearm-related products. The firm’s brands are Smith & Wesson, M&P, Thompson/Center Arms, and Gemtech. The company was founded by Horace Smith and Daniel Baird Wesson in 1852 and is headquartered in Maryville, TN.