Acushnet shares tumble after Q4 earnings miss on debt charge
Golf equipment maker misses estimates by 167% despite revenue growth and dividend increase
Acushnet Holdings Corp. shares declined in Thursday trading after the golf equipment maker reported a significant fourth-quarter earnings miss, dragged down by a $17 million charge related to debt refinancing.
The company reported a quarterly loss of $0.58 per share, far worse than the $0.26 loss expected by analysts, according to Benzinga's earnings summary. The miss represents a 123% deviation from analyst expectations. Revenue for the quarter reached $477.2 million, up $32.05 million year-over-year, marking a 7.2% increase from the prior year.
The disappointing bottom-line result was driven by a $17 million loss on debt extinguishment, a one-time charge stemming from November's refinancing activities. Acushnet completed an offering of $500 million in 5.625% senior notes due 2033, using proceeds to redeem $350 million of higher-cost 7.375% senior notes due 2028 at 103.688% of principal plus accrued interest.
S&P Global Ratings characterized the refinancing as a leverage-neutral transaction that improves liquidity and extends the company's revolving credit facility maturity. The move reduces the company's interest expense burden from 7.375% to 5.625% on the refinanced portion.
Despite the quarterly stumble, Acushnet's full fiscal year 2025 showed resilience. Net sales grew 4.1% to $2.56 billion, while adjusted EBITDA increased 1.5% to $410.4 million. However, full-year net income declined 12% to $188.5 million, impacted by higher interest expenses and lower operating income, partially offset by a non-cash gain from deconsolidating a FootJoy golf shoe joint venture.
The company demonstrated confidence in its financial position by raising its quarterly dividend by 8.5% to $0.255 per share. Additionally, Acushnet repurchased 3.13 million shares during the year for $211.5 million, returning capital to shareholders amid the volatility.
Looking ahead, management provided 2026 guidance calling for net sales between $2.625 billion and $2.675 billion, with adjusted EBITDA expected in the range of $415 million to $435 million. The outlook suggests modest growth of 2.5% to 4.5% in revenue and 1.1% to 6.0% in adjusted EBITDA.
Acushnet, which owns Titleist golf balls and clubs along with FootJoy footwear, faces a challenging retail environment as consumer discretionary spending faces pressure from elevated interest rates. The company's stock had rallied earlier in the year, reaching a 52-week high of $104.81, but remains well above its 52-week low of $54.63.
Analysts maintain a largely cautious stance on the shares, with seven hold ratings and one buy among analysts covering the stock, according to market data. The consensus target price of $90.14 suggests potential downside from current levels.
The company's market capitalization stands at approximately $6 billion, with shares trading at 27.7 times trailing earnings and 23.1 times forward estimates. The dividend yield remains modest at 0.92% after the increase.