10Jul10:50 amEST

Grip it and Rip It

With Topgolf establishments (owned in part by ELY, Callaway Golf) popping up around the country, the main takeaway is impressive demand by consumers for the business model of combining a bar/dining experience with a golf driving range. 

On that note, Drive Shack is an emerging competitor to Topgolf, with plenty of potential growth ahead in its own right. Trading under ticker DS, Drive Shack is an interesting story. The firm used to be a REIT trading under ticker NCT, as Newcastle Investment Corporation. However, they decided to recreate themselves as a leisure-based firm, and specifically they seem keen on competing with Topgolf.

On the DS daily chart updated below, we can see the name catching buying interest again today with very good volume thus far the session.

With a market cap of just over $500 million, DS seems like a fine way to play golf's seemingly renewed popularity as Tiger Woods is back in the conversation and in contention for the major PGA events. 

But even if the PGA tour's popularity flounders, this much more pragmatic version of golf may be a long-term winner with the consumer anyway. 

If DS can clear and hold above $8 anytime soon, with August 1st earnings approaching, I would consider it a viable long. Otherwise, I am inclined to reassess the name with clear bias towards the long side after earnings. 

Stock Market Recap 07/09/18 ... Summer Sleepers


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