Analyzing Sturm, Ruger & Company, Inc. (NYSE:RGR) & Topgolf Callaway Brands (NYSE:CALY)

Sturm, Ruger & Company, Inc. (NYSE:RGR) and Topgolf Callaway Brands (NYSE:CALY) are both consumer discretionary companies, but which is the superior stock? We will contrast the two businesses based on the strength of their risk, institutional ownership, dividends, profitability, analyst recommendations, earnings and valuation.

Analyst Recommendations

This is a breakdown of current ratings for Sturm, Ruger & Company, Inc. and Topgolf Callaway Brands, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sturm, Ruger & Company, Inc.	1	1	1	0	2.00
Topgolf Callaway Brands	0	4	0	0	2.00

Sturm, Ruger & Company, Inc. presently has a consensus target price of $46.00, indicating a potential upside of 18.74%. Topgolf Callaway Brands has a consensus target price of $16.00, indicating a potential upside of 8.19%. Given Sturm, Ruger & Company, Inc.’s higher possible upside, equities research analysts plainly believe Sturm, Ruger & Company, Inc. is more favorable than Topgolf Callaway Brands.

Earnings & Valuation

This table compares Sturm, Ruger & Company, Inc. and Topgolf Callaway Brands”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sturm, Ruger & Company, Inc.	$546.06 million	1.13	-$4.39 million	($0.73)	-53.07
Topgolf Callaway Brands	$2.06 billion	1.29	-$409.30 million	$0.14	105.64

Sturm, Ruger & Company, Inc. has higher earnings, but lower revenue than Topgolf Callaway Brands. Sturm, Ruger & Company, Inc. 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.

Profitability

This table compares Sturm, Ruger & Company, Inc. and Topgolf Callaway Brands’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sturm, Ruger & Company, Inc.	-2.18%	5.96%	4.89%
Topgolf Callaway Brands	1.05%	4.44%	1.59%

Insider and Institutional Ownership

64.0% of Sturm, Ruger & Company, Inc. shares are owned by institutional investors. Comparatively, 84.7% of Topgolf Callaway Brands shares are owned by institutional investors. 4.6% of Sturm, Ruger & Company, Inc. shares are owned by insiders. Comparatively, 2.9% of Topgolf Callaway Brands shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Risk and Volatility

Sturm, Ruger & Company, Inc. has a beta of 0.18, meaning that its share price is 82% less volatile than the S&P 500. Comparatively, Topgolf Callaway Brands has a beta of 0.96, meaning that its share price is 4% less volatile than the S&P 500.

Summary

Topgolf Callaway Brands beats Sturm, Ruger & Company, Inc. on 7 of the 13 factors compared between the two stocks.

About Sturm, Ruger & Company, Inc.

Sturm, Ruger & Co., Inc. engages in the business of designing, manufacturing, and selling firearms to domestic customers. It operates through the Firearms and Castings segments. The Firearms segment focuses on manufacturing and selling rifles, pistols, and revolvers principally to a number of federally licensed, independent wholesale distributors. The Castings segment offers steel investment castings and metal injection molding parts. The company was founded by William B. Ruger in 1949 and is headquartered in Southport, CT.

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.