Leisure Facilities Stocks Q4 In Review: Topgolf Callaway (NYSE:MODG) Vs Peers

Kayode Omotosho /
2024/04/03 5:58 am EDT

As leisure facilities stocks’ Q4 earnings season wraps, let's dig into this quarter's best and worst performers, including Topgolf Callaway (NYSE:MODG) and its peers.

Leisure facilities companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted their spending from "things" to "experiences". Leisure facilities seek to benefit but must innovate to do so because of the industry's high competition and capital intensity.

The 10 leisure facilities stocks we track reported a slower Q4; on average, revenues beat analyst consensus estimates by 3.4% while next quarter's revenue guidance was 21.6% below consensus. Investors abandoned cash-burning companies to buy stocks with higher margins of safety, but leisure facilities stocks held their ground better than others, with the share prices up 12.4% on average since the previous earnings results.

Topgolf Callaway (NYSE:MODG)

Formed between the merger of Callaway and Topgolf, Topgolf Callaway (NYSE:MODG) sells golf equipment and operates technology-driven golf entertainment venues.

Topgolf Callaway reported revenues of $897.1 million, up 5.4% year on year, topping analyst expectations by 3.7%. It was a weaker quarter for the company, with revenue guidance for next quarter missing analysts' expectations.

In terms of 2023 highlights, the company achieved positive free cash flow both on a consolidated basis and at Topgolf, and its Callaway brand finished the year with the #1 U.S. market share for clubs, woods, drivers, fairway woods, hybrids, and irons.

"I am very pleased with our fourth quarter results, which included revenue growth in each of our operating segments, culminating in consolidated revenue growth of over 5% and almost doubling our Adjusted EBITDA1," commented Chip Brewer, President and Chief Executive Officer of Topgolf Callaway Brands.

Topgolf Callaway Total Revenue

The stock is up 18.9% since the results and currently trades at $16.11.

Read our full report on Topgolf Callaway here, it's free.

Best Q4: Life Time (NYSE:LTH)

With over 150 locations and gyms that include saunas and steam rooms, Life Time (NYSE:LTH) is an upscale fitness club emphasizing holistic well-being and fitness.

Life Time reported revenues of $558.8 million, up 18.2% year on year, in line with analyst expectations. It was a strong quarter for the company, with a solid beat of analysts' earnings estimates and revenue guidance for next quarter exceeding analysts' expectations.

Life Time Total Revenue

Life Time scored the highest full-year guidance raise among its peers. The stock is up 17.4% since the results and currently trades at $14.59.

Is now the time to buy Life Time? Access our full analysis of the earnings results here, it's free.

Slowest Q4: Six Flags (NYSE:SIX)

Sporting the fastest rollercoaster in the United States, Six Flags (NYSE:SIX) is a regional theme park operator offering thrilling rides, entertainment, and family-friendly attractions.

Six Flags reported revenues of $292.6 million, up 4.5% year on year, falling short of analyst expectations by 1.7%. It was a weak quarter for the company, with a miss of analysts' earnings estimates.

The stock is up 4.1% since the results and currently trades at $25.6.

Read our full analysis of Six Flags's results here.

Xponential Fitness (NYSE:XPOF)

Owner of CycleBar, Rumble, and Club Pilates, Xponential Fitness (NYSE:XPOF) is a boutique fitness brand offering diverse and specialized exercise experiences.

Xponential Fitness reported revenues of $90.2 million, up 26.6% year on year, surpassing analyst expectations by 10.2%. It was a mixed quarter for the company, with a miss of analysts' earnings estimates. On the other hand, the company blew past analysts' revenue estimates during the quarter, driven by better-than-expected equipment and merchandise sales to its franchisees.

The stock is up 54.3% since the results and currently trades at $15.55.

Read our full, actionable report on Xponential Fitness here, it's free.

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