GOLF: Mixed Ratings And Rich P/E Will Constrain Future Return Potential

Analysts have nudged their fair value estimate for Acushnet Holdings higher, lifting the implied target from about US$79.86 to roughly US$81.29. They cite recent Street research that includes a higher price target from one firm and a sector-weight downgrade from another, modestly updated discount rate and growth inputs, and a slightly higher assumed future P/E multiple.

Analyst Commentary

Recent Street research around Acushnet Holdings has been mixed, with one firm lifting its price target and another moving the shares to a neutral sector-weight stance. Here is how that tension is playing out in the research and what it can mean for valuation and execution expectations.

Bullish Takeaways

Bullish analysts see room for upside to their fair value work, backing a higher target price that is consistent with a modestly higher assumed future P/E multiple.
The higher target suggests confidence that Acushnet can support its current earnings profile, which underpins the slightly richer valuation framework used in updated models.
Supportive research hints that the market may be willing to pay up for execution quality, with the stock treated more like a stable compounder rather than a purely cyclical name.
The modest adjustment to discount rate inputs in recent work points to analysts viewing Acushnet’s cash flow and risk profile as relatively solid in the context of its peer group.

Bearish Takeaways

Bearish analysts shifting to a sector-weight stance signal that, at current levels, they see limited relative upside versus broader golf and consumer names.
The cautious view reflects concern that much of the near term execution story could already be reflected in the share price, which tempers enthusiasm for materially higher valuation multiples.
Some research hints that growth expectations may be finely balanced, so any slip in operating performance or demand could pressure the P/E assumptions that underpin fair value estimates.
The presence of both a price target increase and a downgrade at roughly the same time underlines that risk and reward appear more evenly matched, rather than skewed clearly in one direction.

What's in the News

Management reiterated second half 2025 revenue guidance, pointing to low single digit revenue growth for that period. This keeps the existing outlook in place (company guidance).
The company guided to fourth quarter 2025 revenue of approximately US$448 million, described as high single digit growth over fourth quarter 2023 and aligned with its product launch cadence (company guidance).
Full year 2025 revenue is expected to be in the range of US$2.52b to US$2.54b on a reported basis, giving investors a clearer view of the size of the current revenue plan (company guidance).
Between July 1, 2025 and September 30, 2025, Acushnet repurchased 953,406 shares for US$62.51 million. This represented 1.63% of shares under its ongoing buyback (buyback tranche update).
Since the June 12, 2018 authorization, the company has completed the repurchase of 18,878,890 shares for US$985.25 million. This was described as 28.34% of shares under the program (buyback tranche update).

Valuation Changes

The fair value estimate has risen slightly from about US$79.86 to roughly US$81.29, reflecting a modest upward adjustment in the model.
The discount rate has moved slightly higher from about 7.50% to roughly 7.54%, implying a marginally higher required return in the updated analysis.
The revenue growth assumption is effectively unchanged, holding around 2.75% in both the prior and updated frameworks.
The net profit margin assumption is essentially steady at about 8.78%, with only a very small numerical adjustment in the updated inputs.
The future P/E has been nudged up from about 22.7x to roughly 23.1x, pointing to a slightly richer multiple assumption in the fair value work.

Sustained high growth relies on expanding golf participation, digital sales, affluent demographics, and premium branding, all of which face realistic downside risks.
Investors may be too optimistic about margin expansion and market share in the face of inflation, tariffs, and shifting consumer behaviors.
Secular demand growth, premium products, geographic diversity, and operational efficiency support Acushnet's resilience, margin strength, and commitment to shareholder value.

Catalysts

About Acushnet Holdings

Designs, develops, manufactures, and distributes golf products in the United States, Europe, the Middle East, Africa, Japan, Korea, and internationally.What are the underlying business or industry changes driving this perspective?

The market appears to be pricing in sustained high revenue growth for Acushnet driven by the global trend toward greater health and wellness, with expectations that golf's reputation as a low-impact, lifelong sport will fuel ongoing increases in participation rates; if future participation growth underwhelms or reverses, top-line growth could disappoint.
Elevated valuations may reflect strong confidence in Acushnet's ability to capitalize on the continued aging and increasing affluence of the global population-particularly retirees-assuming these demographic tailwinds will reliably translate into rising demand for premium golf equipment and apparel, and thus robust long-term sales.
The premium being assigned to the stock seems to assume that ongoing investments and upgrades to digital, e-commerce, and direct-to-consumer platforms will accelerate market penetration and international revenue mix; should online sales adoption and international expansion slow relative to expectations, revenue and earnings growth could be below current forecasts.
Investors may be overestimating Acushnet's capacity to consistently expand gross and net margins amid persistent external headwinds-including escalating tariffs, supply chain costs, and inflation-especially given recent guidance that only about half the projected tariff costs will be mitigated in the near term, pressuring net profitability.
Current valuations could be factoring in an expectation that Acushnet will maintain or grow market share via product innovation and brand strength despite rising competition, reliance on mature markets, and potential for a shrinking younger consumer base (due to urbanization and alternative leisure activities), which could limit the company's future revenue growth and margin resilience.

Acushnet Holdings Earnings and Revenue Growth

Acushnet Holdings Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Acushnet Holdings's revenue will grow by 2.5% annually over the next 3 years.
Analysts assume that profit margins will shrink from 9.2% today to 7.8% in 3 years time.
Analysts expect earnings to reach $208.8 million (and earnings per share of $3.88) by about September 2028, down from $230.0 million today. However, there is some disagreement amongst the analysts with the more bullish ones expecting earnings as high as $245.7 million.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 23.6x on those 2028 earnings, up from 19.3x today. This future PE is lower than the current PE for the US Leisure industry at 24.0x.
Analysts expect the number of shares outstanding to decline by 3.53% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 7.68%, as per the Simply Wall St company report.

Acushnet Holdings Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Increasing global golf participation, including the entry of 1.5 million new golfers in 2024 (the seventh consecutive annual increase), and a projected 2% rise in worldwide rounds played, suggest long-term secular demand tailwinds that could support revenue growth and offset macroeconomic pressures.
Acushnet's premium product positioning and ongoing innovation-such as the strong launches of new Pro V1 golf balls and T-Series irons-are enabling price increases and margin improvement, pointing to resilience in net sales and sustaining gross margins even in the face of tariff and inflationary headwinds.
Geographic diversification and continued strength in multiple regions, including the U.S., EMEA (with 20% higher rounds in the U.K.), and stable equipment performance in Asia, reduce regional risk and enable Acushnet to capture revenue growth opportunities outside mature North American markets.
Operational efficiencies, active supply chain management (such as assembling clubs in multiple regions), and effective tariff mitigation strategies position the company to absorb cost pressures and protect net earnings over the long term.
Robust cash flow, prudent capital deployment, and ongoing share repurchases and dividends demonstrate strong balance sheet health and commitment to shareholder returns, supporting long-run value creation for shareholders through improved total returns and earnings per share.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $75.857 for Acushnet Holdings based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $85.0, and the most bearish reporting a price target of just $65.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $2.7 billion, earnings will come to $208.8 million, and it would be trading on a PE ratio of 23.6x, assuming you use a discount rate of 7.7%.
Given the current share price of $75.74, the analyst price target of $75.86 is 0.2% higher. The relatively low difference between the current share price and the analyst consensus price target indicates that they believe on average, the company is fairly priced.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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