Bloomberg: The Golf Economy Is Back!

Bloomberg's Thomas Black reports that the $25 billion U.S. golf business is growing again for the first time in five years.

The number of rounds played on American golf courses has climbed for four straight months through February. Club maker Callaway Golf Co. (ELY), mower-maker Toro Co. (TTC) and Nike Inc. (NKE), which makes golf gear and clothes, are registering revenue growth and stock gains outpacing the Standard & Poor’s 500 Index.

The rebound is reflected on the links. Americans are feeling secure enough in their jobs to increase leisure spending, returning to a sport basking in the media spotlight with this week’s Masters Tournament and Tiger Woods’s first PGA victory in more than two years.

“It will probably be the strongest year since the recession,” Cindy Davis, president of the golf unit of Beaverton, Oregon-based Nike, said in an interview. “I’d say it’s definitely one of the indicators that maybe consumer confidence is coming back.”

Interesting that the equipment industry is still stuck on the $4 billion number while the golf course industry is now five times that, according to Bloomberg:

He said golf’s consumer market draws about $4 billion from equipment, $1 billion from apparel sales and $20 billion from green fees.

The number of golf rounds jumped 10 percent in February, the most recent month for which data is available. That capped four months of year-to-year gains from the economy that were helped by a mild winter in the northern U.S., Nathan said.

Even in California, where the average temperature was about the same as last year, rounds rose 16 percent in February.

This is encouraging on the maintenance side:

“There’s older equipment out there that has quite a bit of hours and courses are realizing that they need to go ahead and re-fleet and purchase new equipment,” said Denny Docherty, Deere’s director of global strategic marketing at the Agricultural and Turf unit.

Toro, based in Bloomington, Minnesota, raised its forecast for 2012 revenue growth in February to as much as 7 percent from 5 percent in December, partly because of increased sales to the golf industry, said Kurt Svendsen, chief of investor relations. The company announced in December it bought the Graden golf greens-roller line for an undisclosed amount.

And this…

ClubCorp, the largest owner and operator of private golf clubs, sold the most memberships last year since 2005, said Eric Affeldt, chief executive officer of the Dallas-based company.

“People are feeling more comfortable spending money again because things aren’t getting any worse,” he said.

ClubCorp which operates in 26 states, bought four golf courses last year and is looking for more, Affeldt said.

“We are rebounding and like what we’re seeing in terms of the recovery,” he said.