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Home Daily Golf Briefs Daily Pulse for February 12, 2018

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Web Street Golf Daily Pulse
VOLUME 8, NUMBER 29                                                         
Monday, February 12, 2018

ANY IDEA WHO SAID THIS? “My legs were always very passive in my swing, and now I’m able to get more of a whip effect and push off the ground. From a biomechanical standpoint, I’ve always had plenty of upper body speed, including the hands, but I was weak using my legs for power. The two areas that I’ve been weak in over the last five years and have held me back are driving and short putts, and I believe they are both becoming strengths. If that’s the case, then I’m going to have a good year. I believe what I’m doing is going to make a huge difference.”

BRAIN TEASER: Can you name the venue for the men’s 2019 U.S. Open?

SOME OF THE UNTOLD STORY: For those of you that tuned in to watch the AT&T Pebble Beach Pro-Am this weekend, there was plenty of attention paid to the weather. Chicago and Detroit, eat your heart out! While the vistas of the Monterey peninsula are truly breath taking, especially under beautiful conditions, Mother Nature also influences scoring. While many want to belly ache about the distance golf balls travel and how it makes the game easier (try not to laugh at this notion) for the best of the best, keep in mind Mother Nature has a big say in the matter.

A year ago, first round conditions saw moderate to heavy rainfall in the afternoon and wind speeds 10-15 mph with gusts to 35 mph. Play was called with resumption on Friday morning with 81 players faced with completing their round. Pebble Beach played to an average score of 74.212, Spyglass Hill 73.308 and Monterey Peninsula CC was the easiest of the three playing to average of 72.451. Fast forward to 2018 and under sunny skies with a high of 70F with winds W/NW 5-10 mph, it was a much different picture, literally and figuratively!

Pebble Beach played to an average score of 71.308 in the first round of the AT&T, more than three shots easier! Spyglass averaged 71.231, two shots easier than a year earlier and  Monterey Peninsula CC, again the easiest of the three courses, played to 69.558, nearly three shots below 2017. No mention of the golf ball or weather in explaining the lower scoring.

COST OF DOING BUSINESS: Callaway Golf reached the $1 billion mark again in annual sales in 2017. The last time it happened for the company was in 2008. However, a couple of things are worth pointing out. Post 2008, the infamous financial crisis and recession saw many businesses manage the expense side of the ledger in order to navigate the unknown choppy waters that lay ahead. Times have indeed and thankfully changed.

Chip Brewer came on board with Callaway in February 2012. Callaway’s general and administrative expenses went from $92.7 million in 2011 down to $61.6 million in 2014. Yet, the company’s overhead jumped from $72 million in 2016 to $94.2 million in 2017.

Meanwhile, research & development, the lifeblood for any equipment business, have increased by 20% over the past five years. In 2012, Callaway’s R&D expenses were $29.5 million. Last year, it was $36.6 million.

The equipment business, which requires significant financial resources, is clearly a big boys game!

callawayINSIDERS: Insider transactions can easily get over analyzed. Is there ever a “good” time to sell from an outsider’s perspective looking in? Some might infer the insider has intimate knowledge of events to be announced that might influence the future stock price. Some might conclude the insider’s belief that better days still lay ahead for the company is in question. Rarely, does anyone conclude the individuals in question might be doing some personal financial planning. Such is life of a public company, which demands transparency.

Take any of that into considered, if you will, as Callaway Golf’s Managing Director, Europe, Middle East and Africa, Neil Howie sold 24,838 shares of the firm’s stock in a transaction on Thursday, February 8th (the day after the company released its 2017 financial results). The stock was sold at an average price of $15.75, for a total value of $391,198.50. Following the completion of the transaction, Howie still owns 95,803 shares in the company, valued at $1,508,897.25. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink.

SVP Brian P. Lynch sold 25,911 shares of the firm’s stock in a transaction dated Friday, February 9th. The shares were sold at an average price of $14.84, for a total transaction of $384,519.24. Following the completion of the sale, Lynch now owns 31,599 shares in the company, valued at $468,929.16. The transaction was disclosed in a document filed with the SEC, which is accessible through this link.

WINNER’S CLUBS: Golf is anything but predictable. With a field boasting world #1 Dustin Johnson along with Jon Rahm (#2), Jordan Spieth (#3), Rory McIlroy (#8) and Jason day (#10), few if anyone would have given Ted Potter Jr a chance to win this past weekend. Even though he was tied for the 54-hole lead with Dustin Johnson, he wasn’t expected to outplay him going into Sunday action. No disrespect intended to Potter, who shot 62 on Saturday at Monterey Peninsula Country Club despite making bogeys on his final two holes in the round. Golf, much like other sports, is always about the marquee names and the AT&T Pebble Beach Pro-Am often delivers. Phil Mickelson, Chez Reavie, Jason Day and Johnson all finished in a tied for second at 14-under par. After his second PGA TOUR career victory, an emotional Potter stated, “It's unbelievable!” Here is what Ted Potter Jr., had in his bag at the 2018 AT&T Pebble Beach Pro-Am:

Driver: Ping G400, 9 degrees
Fairway Metal: Ping G400, 14.5 degrees
Hybrids: Ping G400 (19, 22 degrees)
Irons: Ping iBlade (4-PW)
Wedges: Cleveland RTX-3 (54, 60 degrees)
Putter: Odyssey White Hot #2
Golf Ball: Srixon Z Star XV

Ted Potter Jr’s– Numbers for the week:
Eagles: 1
Birdies: 24
Pars: 38
Bogeys: 9
Double Bogeys: 0
Cumulative Score: 270

WEB GEMS:

BETTER LATE THAN NEVER: Kiradech Aphibarnrat justified his late decision to play in Australia when he survived a marathon final day to claim the World Super 6 in Perth title on Sunday. “I‘m last guy in top 24. I think I‘m last guy to arrive this week as well,” a smiling Aphibarnrat said at the victory presentation after securing his fourth European Tour victory. READ MORE>>>

ANSWERS: “My legs were always very passive in my swing, and now I’m able to get more of a whip effect and push off the ground. From a biomechanical standpoint, I’ve always had plenty of upper body speed, including the hands, but I was weak using my legs for power. The two areas that I’ve been weak in over the last five years and have held me back are driving and short putts, and I believe they are both becoming strengths. If that’s the case, then I’m going to have a good year. I believe what I’m doing is going to make a huge difference.”--Phil Mickelson.

The men’s 2019 U.S. Open will be played June 13-16th at Pebble Beach Golf Links. As noted in the February 8th issue of the Daily Pulse, Pebble Beach was the shortest course on TOUR in 2017 playing at 6,816 yards (scorecard yardage). With it contested in June and under typical U.S Open conditions of firm and fast, will this give more credence to the opponents that contend the golf ball goes too far? Keep in mind Pebble also features the smallest greens on any course the TOUR visits annually!

THE INFORMATION CONTAINED IS BELIEVED TO BE RELIABLE, BUT IT IS NOT GUARANTEED. THE OPINION EXPRESSED IS THAT OF TERRY MCANDREW AND SHOULD NOT BE CONSIDERED A SOLICITATION TO BUY OR SELL SECURITIES IN ANY OF THE COMPANIES DISCUSSED WITHIN THIS NEWSLETTER. CONTENTS OF THIS NEWSLETTER MAY NOT BE REPRINTED OR REBROADCAST WITHOUT THE EXPRESSED WRITTEN CONSENT OF TMAC GOLF