The original social network tool

You've got your Facebook-ers, your LinkedIn-sters, your MySpace-men...and a cornucopia of other social networking tools to advance your virtual social status.

But eventually, all this virtual esteem-building has to come home to root itself in reality...vis-a-vis...some face-time.

Take the much publicized potential Yahoo/Microsoft merger. These two industry titans are trying to find a way to hook-up.
At first it was a brash attempt by Microsoft to force the hand of Yahoo shareholders, thus forcing the hand of one Jerry Yang.

Jerry Yang, co-founder of "Jerry and David's Guide to the World Wide Web", where he put up scores of his favorite websites as well as his own golf scores....for fun.

Oh yeah, his fun idea had legs...two years later it went public. As Yahoo!

So Mr. Yang upgraded from posting golf scores in a college double-wide, to fingering pitching wedges and practicing his putting stroke during corporate meetings in Sunnyvale.

Sweet.

Jerry Yang is like you and me...a golf nut. So is the CEO of Microsoft: Steve Ballmer, so it was only common-sense for these two high-tech titans...titans that will determine directly or indirectly...the fate of social networking, to do one thing...

Golf. Together. In the real world. Face-to face.

Where did they play? Was is Sankaty Head in Nantucket? Augusta in Georgia? Pebble Beach in California? Will their golf outing seal a deal? Don't know. But here's the bigger picture:

Social networking on the Internet will only help you tread water. Knowing the game of golf helps you swim with the sharks.
The game of Golf is the only social network skill you need to accomplish your goals. Golf bridges barriers, and can determine a successful end game to what initially might have started as a bad beginning. Jerry Yang and Steve Ballmer know this, and this is why they play the game.

One question remains in the Micro-hoo takeover talks...

Does Carl Icahn golf?


Thanks for reading. Keep it in the short-grass,

JFB

Ticketreserve.com

Flipping through my recent Newsweek magazine yielded me a great new website I want to tell you about. It's not golf-related...yet...I think though it will be, as it will revolutionize high-demand events.
The website is www.ticketreserve.com. The site allows you to buy options on your favorite team, with the hopes of either reselling the option at a higher price, or buying them at face value.
Let me give you an example: Next month is the holy grail for college basketball- the NCAA Final Four tournament. You can go to www.ticketreserve.com, and right now buy an option on your favorite team, with the guarantee you will be able to buy the real tickets for face value if your team makes it to the Final Four. The higher your team advances, the more your option is worth. If your team makes it to the Final Four, you can purchase these tickets (March 31st) for the event at face value. If your team doesn't make it...well, you've just been given a lesson in Options 101.

If you extrapolate this concept, you can see where this will work for all the golf Majors...even the FedEx Cup. You pick your golfer from the field, if he makes it to the third round, you can buy the ticket at face value.
This is the most revolutionary ticket concept I've seen in a long time, and I believe www.ticketreserve.com will be huge. A couple factors will contribute to this: the ability to seamlessly "flip" options, and the ultimate-being able to make a prediction...its an inherent trait in all of us: the ability to pontificate your prognostication.

I'll tell you my pick after I buy my option!


JFB

Top Flite/Hogan's gonna get squeezed

My first clubs were Hogan's. Producer's, if I remember right.
I had a paper route, and the money I'd saved (or rather my mother saved for me) that first year, paid for a brand new set of Hogan's.
Those clubs are long gone, and are either being put to good use, or rusting in someones basement.

The same thing is going on at Callaway.

This morning, Callaway (ELY) reported its '06 year results. The company is doing really well with it's high net worth brands Callaway/Odyssey...but are failing miserably with the Joe Bag-o-Doughnuts Top-Flite/Hogan brands.

Remember '03? It's when ELY bought the remaining assets of bankrupt Top-Flite. The major assets included the ball maker Top Flite, the Ben Hogan company, and all its facilities.
At the time it seemed like a major coup. And the stock price felt old-man Ely's enthusiasm, going from $10-$15 in 6 months. Nothing like a brand new acquisition to get the fires burning!

But sadly, like driving for show...you to putt for dough.

And dough they haven't made....and as of this morning's year end results... for 3 years. ELY is taking another write-down of assets (um...that means investors get screwed) to account for restructuring initiatives (um...that means they fired a bunch of high-paid executives and paid them even more to leave) at the Top Flite/Hogan facilities.

As a stock market geek, I love reading some of these reports (I think you'd like them too...they can be hilarious (or frightful) at times...go to http://www.footnoted.org/ to see what I mean).

Basically, the ELY report talks about the new Top-Flite initiative, which (after seeing that sales declined again...last year 31% for the Top-Flite/Hogan brands) seems like the initiative would be to eliminate the Top-Flite/Hogan brand either by spinning it off as a private company or canning the brand completely and using the facilities for a Callaway/Odyssey brand expansion. Either way...I believe it's the beginning of the end for the TopFlite/Hogan brands.

ELY is tired of margin squeeze...they see their sales growth of products that cater to high net worth people bringing high margins (Callaway/Odyssey brands)...get pummeled by their products that cater to everyone else (Top Flite/Hogan), because they come with low margins, and uncertainties of spending habits with the economy. ELY's growth projections have more up-and-downs that Tiger Woods on his home course.

So I think ELY's latest initiative...that comes with Top Flite/Hogan brand roll outs and promotions...is more of "fitting the ugly princess with pretty shoes and a gown", and trying to gussy-up the old brand to make it attractive for a private equity firm.

I wonder what will happen to the brand...will the Hogan's be put up for sale one more time to be put to good use.

Or will they end up in a cobweb-filled corner of Callaway's basement, rusting.


Thanks for reading. Keep it in the short-grass,

JFB

Psst..need a stock tip?

Hey buddy, yeah you, get over here...you look worse-off than a fresh spinach salesman. Well buddy, this is your lucky day...why? Because I'm gonna make you money. You got a brokerage account, right? You get Golf magazine, right? Okay. Here's all ya gotta do:

The next time you're reading your Golf magazine, and you see where Phil Micklenuts has signed a new sponsor, call your broker.

And short the stock.

I'm not kidding buddy...this horse has stronger legs than Barbaro....more slam-dunks than the USA basketball team....a better track record than Dusty Baker....

Okay, that last one hurt.

I know, you say you want a sure thing, okay..how's this: Let's look at his top 3 sponsors (all of whom he's faithfully plastered over his frumpy cardigan-tattooed body over the last 5 years). Let's look at Ford, Bearing Point, and Callaway Golf.

Ford: phenominal company....if you sit on the board (not in one of their cars), or if you are Mickelnuts (in which I am assuming he is just collecting sponsorship checks...and not dividends as a stockholder). 5 years ago, F (for you home-gamers) has gone from the new-car showroom smell of $19 to the rusted-out junk-yard puke odor of $7.
Bearing Point: What was one KPMG Consulting (a top dog in its day for IT) has fallen on hard-times since the dot-bomb era. BE (todays' symbol) sat at $20 back then...now, you can find it in the bargain ailse with the Pets.com sock-puppet. It's given nothing but heartworms to investors....unless you're Mickelnuts. I wonder how much he's paid to pull that goofy visor over his bad haircut?
Finally, we have Callaway Golf, or ELY (founder's first name...cute isn't it?). This stock has had more combacks than Evander Holyfield....but it's gotten more than an ear bitten off, as it's been whacked from a high of $19 to where it languishes at $12.

So whattaya think buddy? Pretty good proof, right? I'm tellin' ya...it's golden information.

Hey buddy, gotta go, I think I just saw my new Golf issue goin' into my mailbox.


Thanks for reading. Keep it in the short-grass,

JFB

How does your boss play?

This week Golf Digest revealed it's list of CEO's with the lowest handicaps and how that supposedly relates to a depressed stock price for the company of the CEO.

I say supposedly because it doesn't take into account other outdoor activities.

Since Golf Digest is owned by privately held Advance Publications (think Conde Nast) and the CEO is uber-rich (7.5 billion by Forbes' measures) media mogul, and Univ of Syracuse dropout Donald Newhouse, I felt to be fair we should look at other outdoor activities he and other CEO's employ, and see how that relates to there stock price.

Clay-shooting: I'd like to see a breakdown where stock price and a CEO's high shooting percentage is related. Firearms-maker Sturm Ruger's CEO Wm. Ruger must be dead-eye-Dick at clay shooting, because his stock is down 25% YoY.

Tennis: I'd like to see a correlation between stock price and CEO's ace-count on opposing players. Golf and Tennis reseller Golfsmith's CEO Jim Thompson must be an Eagle-eye for the white line because his stock (in which I warned Daily Slice readers) is down a whopping 35% since its IPO in June.

Finally, let's look at deep-sea fishing. Do you think there is a relationship between hauling in the big one and low stock price?
Yep, there is: CEO Wm McGill of MarineMax (resellers of high-end yachts like Hatteras) must have tons of fish stories because his stock price is off 40% YoY.
(He must save his biggest fish stories for his stockholders).

There you have it. Apparently golf is not the only leisure-time activity that creates a cratering stock price. It's all outdoor activities.

I just wanted to set the record straight.


Thanks for reading. Keep it in the short-grass,

JFB

Golfsmith sells out

I love Golfsmith. I'd say 99% of my golf purchases come from their stores. Being a ClubVantage member, I always get a fair shake when I need club repair done, and I always feel at home when I'm in what I call the tinkerers golf store.

So I was sad to see that Golfsmith has decided (or rather their bankers have) to go public. This week they plan on making $100million +/- by raising capital from public equity via the dreaded IPO.

I'm sad because they plan on using the money the old fashioned way: to retire debt, buy out a private consultant, expand stores, and increase e-commerce.

Excuse me while I yawn.

Golfsmith started out as a little club-making shop in NY. Things progressed, and the family moved the operations to where it now stands in Austin TX. They now have over 55 stores, and is considered the largest retail golf establishment in the world. Pretty good record for a private company, so why go public?

Simple: their appetite for growth has outstripped their cash. They (or rather their bankers) are looking to you to provide them with future cash flow.

Golfsmith should have stayed true to its roots by strictly focusing on being a club-makers shop. Where it's going (through more expansion) is putting it in the cross-hairs of every Tom-Dick-and Harry golf store that competes on price only. PGA Superstores are opening everywhere (one just opened next to the Golfsmith by me....you can literally walk to it from there) and they are very nice. That company is run by former Home Depot guys, so failure is not an option.

It makes sense that Golfsmith (symbol: GOLF) would go public the week of the US Open...the height of golf season, as they would get no interest (which equals less raised money) if they filed in the winter.

So while it might be cool to say you own stock in Golfsmith, don't give your hard-earned money to them. Instead, invest the money in a golf certificate...you'll get more satisfaction.

Thanks for reading. Keep it in the short-grass,

JFB