Adams Golf (ADGF) has been showing up on value sceens for some time now, athough the stock has appreciated a great deal in the last year or so (when it was popping up on net-net screens). Barney Adams is the founder of Adams Golf and credited with the innovation of the hybrid golf club. Although being semi-retired (he is chairman of the board), Adams is very active within golf. I recently read a very interesting and thoughtful open letter that he published, called ‘A Formula for the Renaissance of Golf ‘ (link):
“A rather arrogant title methinks. Let’s start with the question, does golf need a renaissance and to accurately answer I looked up the word. While rebirth is given as a synonym the broader meaning is a cultural change from history going forward. When I accessed data from The National Golf Foundation and the US Census, it struck me that golf, as played regularly by amateurs, needs a renaissance…badly.
Numbers can be pretty boring so here’s the macro analysis. (The census data and National Golf Foundation reports are available for those interested in the details.) We have approximately the same number of golfers playing today as we did in 1990. Since then over 3800 courses have been built in the US and our population has increased over 25%. Moreover, the demographics of our population’s increase in age and income fit the profile of potential golfers. Something has happened over the last 20 years that has resulted in less people taking up and enjoying the game.
Distilling commentary on the Internet we learn that golf has become too time- demanding, too expensive, and too frustrating. I agree with the first comment on time but consider the argument on expense. Paying money to be aggravated and frustrated is not exactly logical, change that to enjoyable and rewarding and the expense argument weakens considerably.”