3 Reasons GOLF is Risky and 1 Stock to Buy Instead

Since March 2021, the S&P 500 has delivered a total return of 72.6%. But one standout stock has nearly doubled the market - over the past five years, Acushnet has surged 131% to $95.73 per share. Its momentum hasn’t stopped as it’s also gained 28.6% in the last six months, beating the S&P by 25.5%.

Is now the time to buy Acushnet, or should you be careful about including it in your portfolio? See what our analysts have to say in our full research report, it’s free.

Why Do We Think Acushnet Will Underperform?

Despite the momentum, we're sitting this one out for now. Here are three reasons you should be careful with GOLF and a stock we'd rather own.

1. Long-Term Revenue Growth Disappoints

A company’s long-term sales performance can indicate its overall quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Unfortunately, Acushnet’s 9.7% annualized revenue growth over the last five years was weak. This fell short of our benchmark for the consumer discretionary sector.

2. Mediocre Free Cash Flow Margin Limits Reinvestment Potential

If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.

Acushnet has shown poor cash profitability relative to peers over the last two years, giving the company fewer opportunities to return capital to shareholders. Its free cash flow margin averaged 5.8%, below what we’d expect for a consumer discretionary business.

3. New Investments Fail to Bear Fruit as ROIC Declines

We like to invest in businesses with high returns, but the trend in a company’s ROIC is what often surprises the market and moves the stock price. On average, Acushnet’s ROIC decreased by 1.2 percentage points annually each year over the last few years. Paired with its already low returns, these declines suggest its profitable growth opportunities are few and far between.

Final Judgment

Acushnet doesn’t pass our quality test. With its shares outperforming the market lately, the stock trades at 24.2× forward P/E (or $95.73 per share). This multiple tells us a lot of good news is priced in - we think there are better stocks to buy right now. Let us point you toward one of our top software and edge computing picks.

Stocks We Like More Than Acushnet

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Stocks that have made our list include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.