B. Riley understands Topgolf concerns after manufacturing plant fire

B. Riley understands investor concerns around Topgolf Callaway following media reports that a chemical fire virtually destroyed the golf ball manufacturing plant operated by Launch Technologies in Pintung County, Taiwan. Initial media reports noted that this manufacturing plant is responsible for ~20% of all golf balls manufactured globally, with 80% earmarked for the U.S. market, and that the company counts Callaway Golf as a customer, the analyst tells investors in a research note. The firm says Topgolf Callaway has previously noted that 75% of its golf ball supply comes from third-party manufacturers in China and Taiwan. However, Riley is optimistic the impact on Topgolf “can be less than feared.” It reiterates a Buy rating on the shares with a $31 price target.