FBR Modeling For 20% Upside In Callaway Golf Shares

FBR analyst Susan Anderson initiated coverage on shares of Callaway Golf Co ELY Thursday morning. She set a new Outperform rating and $12 price target on the stock.

"With the consumer spending more on leisure activities and less at the mall, we believe ELY is well positioned to benefit through a better golf market and its Topgolf stake," according to Anderson.

The FBR analyst highlighted three points to drive shares higher over the next few years:

• "continued market share gains and a highly variable cost structure;
• acquisition opportunity now that ELY has recently retired its debt; and
• its minority stake in Topgolf, which is rapidly growing."

Callaway Golf shares closed Thursday's session at $10.21, up about 2.4 percent for the session.