Barron's: ClubCorp Stock Still Looks Attractive

Membership is up to almost 500 additional members at The Clubs of Prestonwood in Dallas a ClubCorp property The Creek Clubhouse pictured here was part of a multimillion dollar renovation project that included new decor dining social and family features Photo courtesy ClubCorp
<p>Membership is up to almost 500 additional members at The Clubs of <span data-scayt-word="Prestonwood">Prestonwood</span> in Dallas, a <span data-scayt-word="ClubCorp">ClubCorp</span> property. The Creek Clubhouse (pictured here) was part of a multimillion dollar renovation project that included new decor, dining, social and family features. (Photo courtesy ClubCorp).</p>

ClubCorp, Dallas, stock recently received another positive review from Barron's.

The story, "ClubCorp: Still Hitting It Straight Down the Fairway," published June 27 follows an April 19 article in which Barron's called ClubCorp stock "worthy of attention" from investors given the company's opportunities to gain additional market share in the fragmented country club market.

The June 27 story said the stock "still looks attractive"' at its recent $24 per share price. Barron's cited a MKM Partners analyst who said the stock could be worth as much as $40 in two years.

Seeking Alpha countered Barron's optimism with an article published June 30: "ClubCorp: Aggressive M&A To Hide Declines." 

Seeking Alpha looked at ClubCorp's largest segment of revenue, country club dues, and said its 84 percent retention rate (16 percent churn rate) of country club members is made possible through recent acquisitions.

ClubCorp purchased eight clubs in the first quarter of 2015 after adding 50 clubs to its portfolio in the Oct. 2014 acquisition of Sequoia Golf. Total club memberships, including managed clubs, was 180,081 as of March 24.

The article cited a trending decline in nationwide golf course facilities, participation rates and declining income per country club member. Seeking Alpha said ClubCorp's valuation is high, and insiders are taking advantage of the current price to unload shares.

ClubCorp, which went public on the New York Stock Exchange (MYCC) in 2013, owns and operates a portfolio of more than 200 golf and country clubs, business clubs, sports clubs and alumni clubs in 26 states, the District of Columbia and two foreign countries. Many of those clubs include a fitness center.

ClubCorp announced record first quarter results in April, reporting revenue increased $36.3 million to $202.1 million compared to first quarter 2014. The golf and country clubs division generated a total revenue of $159 million in the first quarter, up $31.2 million (24.5 percent) from 2014.

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