A week ago, Callaway Golf Company (NYSE:CALY) came out with a strong set of quarterly numbers that could potentially lead to a re-rate of the stock. It was overall a positive result, with revenues beating expectations by 5.6% to hit US$688m. Callaway Golf reported statutory earnings per share (EPS) US$0.47, which was a notable 17% above what the analysts had forecast. Following the result, the analysts have updated their earnings model, and it would be good to know whether they think there's been a strong change in the company's prospects, or if it's business as usual. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Callaway Golf after the latest results.

After the latest results, the consensus from Callaway Golf's ten analysts is for revenues of US$2.06b in 2026, which would reflect a measurable 2.9% decline in revenue compared to the last year of performance. Statutory earnings per share are predicted to shoot up 117% to US$0.60. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$2.05b and earnings per share (EPS) of US$0.48 in 2026. There was no real change to the revenue estimates, but the analysts do seem more bullish on earnings, given the great increase in earnings per share expectations following these results.

The analysts have been lifting their price targets on the back of the earnings upgrade, with the consensus price target rising 8.1% to US$18.11. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Callaway Golf analyst has a price target of US$23.00 per share, while the most pessimistic values it at US$15.00. As you can see, analysts are not all in agreement on the stock's future, but the range of estimates is still reasonably narrow, which could suggest that the outcome is not totally unpredictable.

These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Callaway Golf's past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 3.8% annualised decline to the end of 2026. That is a notable change from historical growth of 2.0% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 4.1% per year. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - Callaway Golf is expected to lag the wider industry.

The Bottom Line

The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Callaway Golf's earnings potential next year. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Callaway Golf's revenue is expected to perform worse than the wider industry. There was also a nice increase in the price target, with the analysts clearly feeling that the intrinsic value of the business is improving.

With that in mind, we wouldn't be too quick to come to a conclusion on Callaway Golf. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Callaway Golf going out to 2028, and you can see them free on our platform here..

Another thing to consider is whether management and directors have been buying or selling stock recently. We provide an overview of all open market stock trades for the last twelve months on our platform, here.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.