Financial Analysis: Acushnet (NYSE:GOLF) and Leatt (OTCMKTS:LEAT)

Acushnet (NYSE:GOLF) and Leatt (OTCMKTS:LEAT) are both consumer discretionary companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, earnings, risk, valuation, profitability, institutional ownership and dividends.

Insider & Institutional Ownership

53.1% of Acushnet shares are owned by institutional investors. Comparatively, 0.6% of Leatt shares are owned by institutional investors. 53.6% of Acushnet shares are owned by company insiders. Comparatively, 80.0% of Leatt shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Analyst Recommendations

This is a summary of current ratings for Acushnet and Leatt, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Acushnet	0	6	1	1	2.38
Leatt	0	0	0	0	0.00

Acushnet currently has a consensus target price of $84.33, indicating a potential downside of 12.98%. Given Acushnet’s stronger consensus rating and higher possible upside, equities analysts clearly believe Acushnet is more favorable than Leatt.

Profitability

This table compares Acushnet and Leatt’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Acushnet	8.80%	27.50%	9.53%
Leatt	4.12%	5.87%	4.97%

Volatility & Risk

Acushnet has a beta of 0.88, indicating that its share price is 12% less volatile than the S&P 500. Comparatively, Leatt has a beta of 0.89, indicating that its share price is 11% less volatile than the S&P 500.

Earnings & Valuation

This table compares Acushnet and Leatt”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Acushnet	$2.46 billion	2.31	$214.30 million	$3.66	26.48
Leatt	$44.03 million	1.27	-$2.20 million	$0.36	24.86

Acushnet has higher revenue and earnings than Leatt. Leatt is trading at a lower price-to-earnings ratio than Acushnet, indicating that it is currently the more affordable of the two stocks.

Summary

Acushnet beats Leatt on 13 of the 15 factors compared between the two stocks.

About Acushnet

Acushnet Holdings Corp. designs, develops, manufactures, and distributes golf products in the United States, Europe, the Middle East, Africa, Japan, Korea, and internationally. The company operates through four segments: Titleist Golf Balls, Titleist Golf Clubs, Titleist Golf Gear, and FootJoy Golf Wear. It offers golf balls under the Titleist brand; golf clubs, such as drivers, fairways, hybrids, and irons under the Titleist brand; wedges under the Vokey Design brand; and putters under the Scotty Cameron brand. The company also provides golf bags, headwear, golf gloves, travel products, and other golf accessories. In addition, it offers golf shoes, gloves, golf outerwear, and men’s and women’s golf apparel under the FootJoy brand; and ski, golf, and lifestyle apparel under the KJUS brand name. It sells its products through on-course golf shops and golf specialty retailers, as well as through representatives, other retailers, and online. The company was formerly known as Alexandria Holdings Corp. and changed its name to Acushnet Holdings Corp. in March 2016. Acushnet Holdings Corp. was founded in 1910 and is headquartered in Fairhaven, Massachusetts.

About Leatt

Leatt Corporation designs, develops, markets, and distributes personal protective equipment for participants of motor sports and leisure activities worldwide. The company offers Leatt-Brace system, an injection molded neck protection system designed to prevent injuries to the cervical spine and neck. It also provides helmets for head and brain protection; and body armor products, including chest protectors, full upper body protectors, upper body protection vests, back protectors, knee braces, knee and elbow guards, off-road motorcycle boots, and mountain biking shoes. In addition, the company offers other products, parts, and accessories, such as goggles; toolbelt, duffel, gear, helmet bags, hats, and hydration kits; casual clothing, caps, and sunglasses; and apparel that comprises suits, jackets, jerseys, pants, shorts, socks, and gloves, as well as aftermarket support products. Further, it acts as the original equipment manufacturer for personal protective equipment sold by other brands. The company's products are used by riders of motorcycles, bicycles, snowmobiles, and ATVs. It sells its products to customers through a network of distributors and retailers; and direct to end consumers through digital channels and online store at leatt.com. The company was formerly known as Treadzone, Inc. and changed its name to Leatt Corporation in May 2005. The company was founded in 2001 and is headquartered in Durbanville, South Africa.