Acushnet Holdings Corp. (GOLF)

Americas/United States Equity Research Leisure Products Rating NEUTRAL Price (21-Nov-16,US$) 19.16 Target price (US$) 20.00 52-week price range 19.16-17.30 Market cap (US$ m) 1,419.63 *Stock ratings are relative to the coverage universe in each analyst's or each team's respective sector. ¹Target price is for 12 months. [V] = Stock Considered Volatile (see Disclosure Appendix) Christian Buss 212 325 9667 christian.buss@credit-suisse.com Sara Shuler 212 325 7643 sara.shuler@credit-suisse.com Pallavi Bakshi 212 538 8434 pallavi.bakshi@credit-suisse.com Quarterly EPS Q1 Q2 Q3 Q4 2015A 0.44 0.62 0.03 0.12 2016E 0.54 0.54-0.03 0.07 2017E 0.41 0.56 0.10 0.07 Acushnet Holdings Corp. (GOLF) INITIATION Top Dog in a Tough Neighborhood; Initiate with Neutral Rating and $20 TP We initiate coverage of Acushnet with a Neutral rating and $20 target price. We view the company as well-positioned within the golf equipment market, with a strong brand portfolio, industry-leading R&D capabilities and innovation, and a focused consumer demographic. However, we have big concerns about a deteriorating golf market with retailers pressured and golf courses closing. We expect mid-to-high single-digit earnings growth over the next 5 years. Our target price is based in part on a multiple in-line with Sporting Goods and Lifestyle peers (17.5x FY17 EPS of $1.14), suggesting a balanced risk/reward profile. Compelling Combination of Premier Brands and Innovation Cycle: We view Acushnet as a best-in-class golf equipment manufacturer, with its core brands Titleist and FootJoy well-positioned in the market. We expect the focus on innovation and high R&D investment to help the company maintain its premium standing among dedicated golfers. We also view the skew of business into consumables (1/3 revenue from golf balls) as a counterbalance to the risks of a low-turn (2.2x), seasonal (80% of EBIT in 1H) business. Market Headwinds Give Us Pause: The combination of near-term headwinds from retailer bankruptcies, competitor exits, and longer-term risks associated with lower participation levels in golf and golf course closures suggest that the underlying demand environment will likely remain disrupted over the next several years. While Acushnet will likely emerge as a long-term consolidator of market share as a result of these changes, pricing and margin pressure are clear near-term risks that keep us on the sidelines. $1.7B Revenue Potential, $1.50 Earnings Potential by FY21: We see opportunity for Acushnet to maintain low-single digit revenue growth and high-single digit EPS growth as a baseline case, absent dramatic pricing disruption in the marketplace. Given GOLF's tight control of fixed expenses, we see potential for 200bp of operating margin expansion in this time period. Financial and valuation metrics Year 12/15A 12/16E 12/17E 12/18E EPS (CS adj.) (US$) 1.20 1.11 1.14 1.25 Prev. EPS (US$) - - - - P/E (x) 15.9 17.3 16.8 15.3 P/E rel. (%) 85.8 94.0 102.7 104.4 Revenue (US$ m) 1,503.0 1,554.5 1,582.2 1,630.2 EBITDA (US$ m) 214.7 200.9 210.9 225.0 OCFPS (US$) 1.24 1.56-0.20 1.77 P/OCF (x) 12.3-94.4 10.9 EV/EBITDA (current) 10.0 10.7 10.2 9.6 Net debt (US$ m) 777 305 363 309 ROIC (%) 9.54 8.86 8.12 9.11 Number of shares (m) 74.09 IC (current, US$ m) 1,101.62 BV/share (Next Qtr., US$) 10.8 EV/IC (x) 1.6 Net debt (Next Qtr., US$ m) 306.3 Dividend (current, US$) - Net debt/tot eq (Next Qtr.,%) 38.5 Dividend yield (%) - Source: Company data, Thomson Reuters, Credit Suisse estimates DISCLOSURE APPENDIX AT THE BACK OF THIS REPORT CONTAINS IMPORTANT DISCLOSURES, ANALYST CERTIFICATIONS, LEGAL ENTITY DISCLOSURE AND THE STATUS OF NON-US ANALYSTS. US Disclosure: Credit Suisse does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

Acushnet Holdings Corp. (GOLF) Price (21 Nov 2016): US$19.16; Rating: NEUTRAL; Target Price: US$20.00; Analyst: Christian Buss Income Statement 12/15A 12/16E 12/17E 12/18E Revenue (US$ m) 1,503.0 1,554.5 1,582.2 1,630.2 EBITDA 215 201 211 225 Depr. & amort. (42) (41) (42) (40) EBIT (US$) 173 160 169 185 Net interest exp (25) (22) (16) (14) PBT (US$) 151 138 153 171 Income taxes (59) (53) (64) (71) Profit after tax 92 86 89 100 Other NPAT adjustments 0 0 0 0 Cash Flow 12/15A 12/16E 12/17E 12/18E Cash flow from operations 90 116 (15) 134 CAPEX (23) (25) (28) (28) Free cashflow to the firm 67 90 (43) 106 Cash flow from investments (22) (25) (28) (28) Net share issue(/repurchase) 35 374 19 25 Dividends paid (18) (5) (35) (37) Cashflow from financing activities 10 380 (16) (52) Effect of exchange rates (3) 2 0 0 Changes in Net Cash/Debt 74 472 (59) 54 Net debt at start 852 777 305 363 Change in net debt (74) (472) 59 (54) Net debt at end 777 305 363 309 Balance Sheet (US$) 12/15A 12/16E 12/17E 12/18E Cash & cash equivalents 59 120 117 67 Account receivables 192 198 205 210 Other current assets 94 88 89 90 Total fixed assets 255 242 228 216 Investment securities - - - - Total assets 1,759 1,830 1,771 1,684 Total current liabilities 756 504 332 345 Shareholder equity 325 817 854 878 Total liabilities and equity 1,759 1,830 1,771 1,684 Net debt 777 305 363 309 Per share 12/15A 12/16E 12/17E 12/18E No. of shares (wtd avg) 72 74 75 76 CS adj. EPS 1.20 1.11 1.14 1.25 Prev. EPS (US$) Dividend (US$) 0.00 0.00 0.00 0.00 Free cash flow per share 0.92 1.22 (0.57) 1.39 Earnings 12/15A 12/16E 12/17E 12/18E Sales growth (%) (2.3) 3.4 1.8 3.0 EBIT growth (%) 8.6 (7.4) 5.8 8.9 Net profit growth (%) 8.2 (5.6) 4.0 12.1 EPS growth (%) 4.0 (7.9) 2.9 10.2 EBITDA margin (%) 14.3 12.9 13.3 13.8 EBIT margin (%) 11.5 10.3 10.7 11.3 Pretax margin (%) 10.1 8.9 9.7 10.5 Net margin (%) 5.8 5.3 5.4 5.9 Valuation 12/15A 12/16E 12/17E 12/18E EV/EBITDA (x) 10.0 10.7 10.2 9.6 P/E (x) 15.9 17.3 16.8 15.3 Returns 12/15A 12/16E 12/17E 12/18E ROIC (%) 0.1 0.1 0.1 0.1 Gearing 12/15A 12/16E 12/17E 12/18E Net debt/equity (%) 239.4 37.3 42.5 35.2 Quarterly EPS 2015A Q1 0.44 Q2 0.62 Q3 0.03 Q4 0.12 2016E 0.54 0.54-0.03 0.07 2017E 0.41 0.56 0.10 0.07 Source: Company data, Thomson Reuters, Credit Suisse estimates Company Background Acushnet is a leading manufacturer of golf equipment. The company produces the #1 market share golf ball (ProV1) and #1 market share golf shoe (FootJoy.) Distribution is focused on green grass pro shops and controlled big box specialty retailers. Blue/Grey Sky Scenario Our Blue Sky Scenario (US$) 26.00 Our analysis suggests a $26 share price in an upside scenario in which revenue growth accelerates to a mid-single digit rate and a 25bp gross margin tailwind as fixed expenses are levered. Our Grey Sky Scenario (US$) 16.00 In a downside scenario, shares could be priced at $16 given potential for revenue declines in the low-single digit negative, a 25bp gross margin headwind, and deleverage of fixed production and SG&A expenses. 2 0 1 9 1 8 1 7 Share price performance N o v - 1 6 N o v - 1 6 N o v - 1 6 GO LF.N S& P 5 0 0 IN D EX On 21-Nov-2016 the S&P 500 INDEX closed at 2195.61 Daily Oct28, 2016 - Nov21, 2016, 10/28/16 = US$17.95 Acushnet Holdings Corp. (GOLF) 2

Investment Thesis We initiate coverage of Acushnet Holdings Corp with a Neutral rating and $20 target price. We expect consistent mid-to-high single digit earnings growth over the next five years, driven by steady low-single-digit topline growth and operating margin expansion of 180bp. We ultimately see opportunity for $1.7B in revenue and $1.50-plus in EPS by FY21. We believe Acushnet has a competitive advantage within the specialty golf industry, as it controls two top-tier golf brands that target a resilient, avid amateur demographic Titleist (balls and equipment) and FootJoy (footwear and apparel) and we see compelling reason for these brands to maintain their market leadership through substantial R&D investment and a differentiated two-year product cycle. However, we believe near- and mid-term industry concerns outweigh these strategic advantages, as we expect the next two years to be marked by retailer disruption, competitor exit, and underlying demand weakness amid declining sport participation. Our Take on Acushnet Holdings Well-Positioned Among Competitors to Maintain Market Leadership: Acushnet is competitively well-positioned in the golf equipment market due to (1) a dominant brand portfolio across golf balls, clubs, and footwear through the Titleist and FootJoy brands; (2) leading innovation given a consistent R&D spend at 7-8% of SG&A; (3) a two-year product lifecycle that mitigates markdown and inventory obsolescence risks of a seasonal and generally durable good business; (4) a more resilient core demographic of dedicated golfers who make up the majority of rounds played and industry spend. As a result, we believe the company is well-positioned to defend its industry-leading market share and perhaps capture further share as competitors exit the market. Market Analysis Suggests Industry Consolidation Could Negatively Impact Golf Industry over Next Two to Three Years: The near- and long-term dynamics for the golf industry suggest pressure on the market, which will likely be difficult for growth over the next two to three years. Hardware consolidation, accelerated with the planned exit of Nike and adidas from the golf equipment business, will likely disrupt inventory flow and pricing as product is cleared. Given the increasing number of specialty sporting goods retailers filing for bankruptcy, we see even more risk for elevated markdown levels and a glut of discounted goods in the supply chain. The longer-term dynamics for the industry remain pressured too, with golf courses closing and golf participation declining, particularly in the United States, which generated 54% of Acushnet sales in 2015. Product Segment Leadership Suggests Opportunity to Grow Topline at 1-3% CAGR: We expect low-single digit topline growth across all four operating segments over the next four years given the challenging environment. We see the potential for Titleist Golf Balls to add an incremental $44M in revenue, Titleist Golf Clubs to add $63M in revenue, Titleist Golf Gear to add $24M in revenue, and FootJoy Golfwear to add $64M in revenue. Operating Margin Expansion Potential of 180-200bp by FY21: In our view, Acushnet could expand operating margin by 200bp over the next five years, recapturing much of the gross margin degradation seen in 2016 while benefiting from leverage of fixed production and SG&A expenses. Blue-Sky Upside at $26, Grey-Sky Downside at $16: Our analysis suggests a $26 share price in an upside scenario in which revenue growth accelerates to a mid-single digit rate and a 25bp gross margin tailwind as fixed expenses are levered. In a downside scenario, shares could be priced at $16 given the potential for revenue declines in the low-single digit negatives, a 25bp gross margin headwind, and deleverage of fixed production and SG&A expenses. Acushnet Holdings Corp. (GOLF) 3

Investment Thesis Key Charts Figure 1: Acushnet Holds a Dominant Brand Portfolio Supported by Industry-Leading R&D Spend and Innovation 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% R&D Spend As A % Of SG&A 7.3% 7.0% 7.0% 7.2% 7.7% 7.6% 7.6% 7.7% 7.7% 2012 2013 2014 2015 2016E 2017E 2018E 2019E 2020E Figure 2: The Company is also Focused on a More Resilient Core of Dedicated Golfers Who Dominate Rounds Played and Golf-Related Spend 20.0 Total US Golfers (Millions) 20.9 20.7 20.5 19.5 19.1 18.9 18.6 18.3 18.1 5.7 4.4 4.0 4.2 4.6 4.5 4.3 4.1 3.9 3.7 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Recreational Golfers Committed Golfers Source: National Golf Federation data. Figure 3: Market Conditions Give Us Pause as Competitors Exit Golf Equipment, Leading to Retailer Discounting and Inventory Imbalances Golf Segment Y/Y Revenue Growth 14.9% 10.3% 9.0% 28.7% -0.3% -4.4% -2.5% -28.9% -1.2% -8.2% 2011 2012 2013 2014 2015 Nike Golf adidas TaylorMade Figure 4: And Industry Conditions Remain Challenged, with Golf Rounds Played Declining and over 750 Golf Courses Closing Between 2010-2020 510 500 490 480 470 460 450 440 430 501 498 Golf Rounds Played In The US 489 486 475 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Rounds Played in the US (millions) 463 491 466 458 Y/Y Change in Rounds Played 466 8% 6% 4% 2% 0% -2% -4% -6% Source: National Golf Federation data. Acushnet Holdings Corp. (GOLF) 4

Product Strategy Levers Significant R&D Investment, Lengthens Product Life Cycles, and Mitigates Markdown Risk Two-Year Product Cycles Figure 5: Products Are Released in Alternate Years We believe Acushnet's two-year product lifecycle is a competitive advantage as it: Leverages industry-leading R&D investment and innovation to support the premium branding for the Titleist and FootJoy brands; and Mitigates markdown risk compared with competitors by lengthening product shelf-life and avoiding the seasonal risks associated with a low-turn weather-exposed business. This strategy helps contribute to relatively steady product revenue flows, although we note the alternating nature of product introductions does lend some uneven revenue growth, as growth can shift into 1H when new golf balls are introduced and 2H when new clubs are introduced. We outline this product introduction cadence by product. (See Figure 5.) PRODUCT INTRODUCTIONS & SELL-IN ODD YEAR EVEN YEAR 1Q/2Q 3Q/4Q 1Q/2Q 3Q/4Q Pro V1, Pro V1x Golf Balls Scotty Cameron Futura Putters Golf Clubs (A) - Iron & Hybrids NXT, Velocity, DT Golf Balls Scotty Cameron Select Putters Golf Clubs (B) - VG3 Drivers, Fairways, Hybrids, & Irons Golf Clubs - Drivers & Fairways Source: Credit Suisse research. Figure 6: Sell-Through Means Odd-Years Sell More Golf Balls, Even-Years Sell More Golf Clubs PRODUCT SELL-THROUGH & SALES ODD YEAR EVEN YEAR Higher Rate of Sales: Golf Balls Higher Rate of Sales: Golf Clubs 1Q/2Q 3Q/4Q 1Q/2Q 3Q/4Q As the Pro V1 franchise is the highest volume and highest priced product in Acushnet's golf ball category, sell-through and net sales are typically highest in the Titleist golf ball segment in odd-numbered years. Sales occur at a higher rate in even-numbered years due to: 1) Irons & Hybrids introduced in the even year (A) sell-through the following year that are usually custom fit purchases 2) Intra-quarter sell-through of VG3 Drivers, Fairways, Hybrids, & Irons (B) Source: Credit Suisse research. Titleist Golf Balls Are Released in the First Quarter of Odd-Numbered Years Acushnet Holdings Corp. (GOLF) 5

o o o New product launches of the premium Pro V1 and Pro V1x occur in the first quarter of odd-numbered years. New product launches of performance level NXT Tour, Velocity, and DT occur in the first quarter of even-numbered years. Golf ball sales occur at a higher rate in the year of the initial launch than in the second year. Given the Pro V1 franchise is the highest volume and highest priced product in this product category, net sales are typically highest in the Titleist golf ball segment in odd-numbered years. Titleist Golf Clubs Are Released in the Fourth Quarter of Even-Numbered Years o o Drivers and fairways are released in the fourth quarter of even-numbered years, resulting in a sales increase in that quarter as well as the following spring/summer of odd-numbered years. Irons and hybrids are released in the fourth quarter of odd-numbered years, with the majority of sales generated in the following spring/summer of even-numbered years, as these are usually custom-fit purchases. o Innovation and R&D Golf Club sales occur at a higher rate in even-numbered years due to: (1) the majority of new irons and hybrids sales occur in the spring/summer of even-numbered years; (2) the increase in sales of drivers and fairways due to inter-quarter sell-in in the fourth quarter of even-numbered years; and (3) sales of Vokey design wedges, Scotty Cameron Select putters, and Japan specific-vg3 drivers all occur in the first quarter of even-numbered years. Acushnet leads the industry in innovation and R&D spend, which we believe particularly reinforces the Titleist brand's positioning as the premier golf ball for players. R&D spend as a percentage of revenue was 2.9% of sales and 7.2% of SG&A in 2015. The R&D team consists of over 80 scientists, chemists, engineers, and technicians, and responsibilities involve player research, aerodynamics testing, data analytics, and rigorous central quality controls. Acushnet uses a vertically integrated manufacturing process for its golf balls and has created the largest scope and scale golf ball manufacturing process in the world. This includes two factories in the U.S. and one in Thailand, which altogether encompass 600,000 square feet. Figure 7: Nearly 3% of Revenue Is Invested Back into R&D Figure 8: 7% of SG&A Spend Is Dedicated to R&D R&D Spend As A % Of Revenue R&D Spend As A % Of SG&A 5% 4% 3% 2% 1% 0% 3.1% 2.9% 2.8% 2.7% 2.9% 3.0% 3.0% 3.0% 3.0% 2012 2013 2014 2015 2016E 2017E 2018E 2019E 2020E 10% 9% 8% 7% 6% 5% 4% 3% 2% 1% 0% 7.7% 7.3% 7.6% 7.6% 7.7% 7.7% 7.0% 7.0% 7.2% 2012 2013 2014 2015 2016E 2017E 2018E 2019E 2020E Acushnet Holdings Corp. (GOLF) 6

Acushnet also owns significant intellectual property patents for its golf products, with 44% of all golf ball patents and 15% of all golf club patents registered to company brands in the last four years. Figure 9: Acushnet Owns the Most Golf Ball Patents in the Industry Since 2011 Golf Ball Patents (2011-2015) TaylorMade, 5% Callaway, 4% Nike, 14% Acushnet, 44% Figure 10: Acushnet Is Only Behind Nike in Golf Club Patents over the Last Four Years Golf Club Patents (2011-2015) Karsten, 8% Cobra, 6% TaylorMade, 14% Acushnet, 15% Bridgestone, 8% Dunlop/SRI, 16% Callaway, 15% Dunlop/SRI, 15% Bridgestone, 17% Nike, 19% Source: Company data. Source: Company data. Acushnet Has a Focused and Sustainable Consumer Demographic Focusing on Dedicated Golfers Acushnet's target market is the industry's share of dedicated golfers, which it defines as largely Generation-X (age 30-49) and Baby Boomer (age 50-69) golfers who are avid and skill-biased, prioritize performance, and commit the time, effort, and money to improve their game. Acushnet believes that this target audience is estimated to represent 15% of all U.S. golfers, who play 40% of all U.S. rounds played, and account for 70% of all U.S. golf industry spending. According to National Golf Federation data, there are approximately 24M golfers in the United States, or people who have played at least one round of golf in the year 2015. Of those 24M golfers, NGF segments the share of committed golfers to be approximately 80%. These committed golfers are defined as consumers who plan to continue playing golf for the next three to five years and have many of the same consumer characteristics as dedicated golfers. We estimate that this share of committed golfers is likely to remain steady even as the total pool of U.S. golfers is likely to decline. With Acushnet targeting this sustainable consumer base, we believe the company is more sheltered from the negative effects of declining golf participation. Acushnet Holdings Corp. (GOLF) 7

Figure 11: The Percentage of Committed Golfers (~80%) Remains Steady Even as the Number of Total U.S. Golfers Declines Total US Golfers (Millions) 20.0 20.9 20.7 20.5 19.5 19.1 18.9 18.6 18.3 18.1 5.7 4.4 4.0 4.2 4.6 4.5 4.3 4.1 3.9 3.7 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Recreational Golfers Committed Golfers Source: National Golf Federation data. Figure 12: Acushnet's Target Audience Plays 40% of All Annual U.S. Golf Rounds Percentage Of All US Rounds Played Figure 13: And Is Estimated to Account for 70% of U.S. Golf Industry Spend Percentage Of All US Golf Spend Acushnet Target Audience, 40% Other, 30% Other, 60% Acushnet Target Audience, 70% Source: Company data. Source: Company data. We believe it is appropriate for Acushnet to focus on this core segment of the golf market. We expect the dedicated golfer market will likely remain steady even as overall golf participation declines, due to: A growing share of the U.S. population is expected to have higher incomes over the next two decades, with estimates for the percentage of the U.S. population making over $80,000 in annual income to increase from 25% of the population in 2015 to nearly 31% of the population by 2030; The percentage of the U.S. population over the age of 65 is forecast to increase from 13% in 2010 to over 20% by 2030, suggesting that an aging population of Baby Boomers and retirees are more likely to commit the time and money to playing golf. Acushnet Holdings Corp. (GOLF) 8

Figure 14: We Expect a Greater Percentage of the U.S. Population Will Be Earning over $80K by 2030 Share Shift Of US Population By Income Level 100% 90% 80% 2015, 24.8% 2030, 30.7% 70% 60% 50% 40% 30% 20% 10% 0% 2015 2020 2025 2030 Under $80,000/yr Over $80,000/yr Source: Euromonitor. Figure 15: As People Live Longer, the Percentage of the Population over 65 Years Old Could Grow to 20% Percentage Of US Population Over 65 20.3% 20.9% 13.1% 2010 2030 2050 Source: US Census Bureau estimates. Rounds Played and Number of Golf Courses Continue to Decline However, even as Acushnet continues to target the sustainable segment of dedicated golfers, we remain concerned that the sport of golf in the U.S. is losing popularity and losing share of sports participation, especially among millennials, leading to declining golf facilities and rounds played. Over the last nine years, golf rounds played have fallen 7% from their 2012 peak of 491M rounds to 2015's 466M rounds. Additionally, the National Golf Federation expects 750 golf courses to close between 2010 and 2020, reversing the golf course boom of the 1990s. We are concerned to see rounds played and the number of golf courses declining, as much of Acushnet's green grass business is directly dependent on steady and increasing rounds played at courses. Acushnet Holdings Corp. (GOLF) 9

Figure 16: Golf Rounds Played Are Down 7% from Recent Peak Levels In 2012 Golf Rounds Played In The US 510 500 490 480 470 460 450 501 498 489 486 475 463 491 466 458 466 8% 6% 4% 2% 0% -2% 440-4% 430 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015-6% Rounds Played in the US (millions) Y/Y Change in Rounds Played Source: National Golf Federation data. Figure 17: 2010 Is Seeing a Reversal from the Golf Course Boom of the 1990s Net Addition Of US Golf Courses By Decade 3803 1817 2641 841 492-750 1960s 1970s 1980s 1990s 2000s 2010s Source: National Golf Federation data. The Golf Equipment Industry Reckoning: Increasing Consolidation as Nike Exits, adidas Sells TaylorMade We estimate that the global branded leisure equipment market in 2015 was valued at approximately $35B. Acushnet wholesale revenues of $1.05B made it the 12 th largest sports equipment manufacturer globally, outpacing competitor Callaway Golf (ranked at 16 th ) but behind adidas (7 th ) and Nike (9 th ). There was declining wholesale equipment revenue growth in the Golf Equipment (-5.5% Y/Y), Sports Equipment (-8.2% Y/Y), and Fishing/Outdoors (-3.2% Y/Y) categories. While much of the decline is attributable to weakness in international markets, U.S. golf equipment revenues were down 0.8% Y/Y, suggesting tepid growth domestically. Acushnet Holdings Corp. (GOLF) 10

Figure 18: Acushnet Is the 12 th Largest Sports Equipment Manufacturer Globally by Wholesale Revenues 3247 Total Global Branded Equipment Market 2015 Wholesale Revenue (Millions) 2737 2083 1902 1871 1858 1759 1620 1551 1149 1094 1054 1000 970 850 844 825 809 795 683 655 643 568 545 534 525 456 430 419 397 367 336 309 253 Source: Sporting Goods Intelligence data. Figure 19: Golf Equipment, Sports Equipment, and Fishing/Outdoors Equipment Saw the Greatest Declines in Wholesale Revenues Y/Y Source: Sporting Goods Intelligence data. 2015 Branded Equipment Wholesale Revenue (Millions) Category US International Total Total Y/Y Golf $964 $934 $1,898-5.5% Fitness/Gym Equipment $1,731 $1,327 $3,058 1.4% Sports Equipment $2,349 $3,784 $6,133-8.2% Hunting/Guns $3,746 $374 $4,120 5.5% Bikes $2,915 $7,219 $10,134 1.1% Fishing/Outdoors $3,196 $2,151 $5,347-3.2% Wearables $3,084 $1,364 $4,448 43.3% Acushnet Holdings Corp. (GOLF) 11

Figure 20: Domestic Golf Equipment Revenues Fell 0.8% Y/Y in 2015 US Y/Y Growth Branded Equipment Wholesale Revenue 5.8% Figure 21: International Golf Equipment Revenues Fell 9.9% Y/Y in 2015 International Y/Y Growth Branded Equipment Wholesale Revenue 3.0% 4.1% 3.0% 0.3% 1.3% -0.8% -1.9% -5.4% -12.4% -9.9% -9.2% Golf Equipment Gym Equipment Sports Equipment Hunting Equipment Cycling Equipment Outdoor Equipment Golf Equipment Gym Equipment Sports Equipment Hunting Equipment Cycling Equipment Outdoor Equipment Source: Sporting Goods Intelligence data. Source: Sporting Goods Intelligence data. The golf equipment industry has seen topline growth opportunities shrink over the last three to five years. Nike and adidas have experienced negative golf revenue growth over the last three years, with Nike's golf segment down -0.3% Y/Y in 2013, -2.5% Y/Y in 2014, and -8.2% Y/Y in 2015. adidas' golf segment was down -4.4% Y/Y in 2013, -28.9% Y/Y in 2014, and -1.2% Y/Y in 2015. As a result, both companies announced in 2016 that they would be exiting the business and instead would be focusing on golf apparel and footwear. While we expect a buyer to emerge for adidas's TaylorMade brand, we see risk of inventory flow and pricing disruption in the near term as a result of this transition. Figure 22: Both Nike and adidas Are Exiting the Segment Amid Falling Revenues and Increasing Unprofitability Company 2015 Segment Sales Date Strategic Announcement Nike $706M 8/3/2016 "Nike will accelerate innovation in its Golf footwear and apparel business and will partner with more of the world s best golfers. With this new focus, Nike Golf will transition out of equipment - including clubs, balls and bags." "Going forward, the Group intends to focus its efforts in the golf market segment on adidas further strengthening its position as a leading provider of innovative golf footwear and 902M (60% is apparel through the adidas Golf brand. At the same time, the company will actively estimated to be 5/4/2016 seek a buyer for the remainder of its golf business, which mainly consists of the equipment sales) TaylorMade brand, a market leader in golf equipment, as well as the Adams and Ashworth brands." Source: Company data. Figure 23: Both Companies Saw Golf Segment Revenues Decline from 2013 Onward Golf Segment Y/Y Revenue Growth 28.7% 14.9% 10.3% 9.0% -0.3% -4.4% -2.5% -1.2% -8.2% -28.9% 2011 2012 2013 2014 2015 Nike Golf adidas TaylorMade Source: Company Annual Reports Acushnet Holdings Corp. (GOLF) 12

Specialty Sporting Goods Retailer Consolidation Likely to Have Near-Term Inventory Impact and Longer-Term Distribution Impact Big-Box Retailers Consolidation Sporting goods stores and specialty golf stores in the U.S. have been growing store counts on average 5% annually. This store count growth peaked in 2015, with approximately 1,690 stores domestically. We believe this rapid growth has led to oversaturation of the sporting goods market, forcing many retailers into bankruptcy in the last six to nine months. While Acushnet limits its distribution in this channel, we believe that pricing pressure with store liquidations and excess inventory in a promotional channel will disrupt the aggregate pricing environment. We believe it is likely that this channel will remain challenged well into 2017 as a result. Key retailer bankruptcies in 2016: City Sports: Filed for bankruptcy in October 2016. The buyer Hilco Merchant Resources closed all 26 stores and liquidated assets. Golfsmith: The largest specialty golf retailer in the United States. The company filed for bankruptcy in September 2016, with the brand name and intellectual property sold to Dick's Sporting Goods in October 2016. Dick's is expected to keep at least 30 stores while winding down the remaining 80 stores. We note that Dick's also owns the Golf Galaxy retail brand, a golf specialty retailer with 72 locations in the United States. Sports Chalet: Owned by the Vestis Retailing Group, this full-line sporting goods company filed for bankruptcy in April 2016 and closed all 47 stores countrywide. The Sports Authority: The full-line sporting goods store filed for bankruptcy in March 2016 and closed all 450 stores as of August 2016. The major remaining sporting goods retailers include Dick's Sporting Goods, Academy Sports and Outdoors, Big 5 Sporting Goods, MC Sports, and Modell's, and the major remaining specialty golf retailers include Golf Galaxy (owned by Dick's Sporting Goods), PGA Tour Superstore, and Worldwide Golf. Figure 24: The Closure of Sports Authority (450 stores), Sports Chalet (47 stores), and Golfsmith (80 stores) Halts the ~5% Y/Y Expansion of Full-Line Sporting Goods Stores and Specialty Golf Stores Since 2006 2,000 US Sporting Goods Stores & Specialty Golf Stores 15% 1,750 1,500 1,250 1,135 1,259 1,336 1,340 1,370 1,424 1,482 1,551 1,629 1,681 1,155 10% 5% 0% -5% 1,000-10% 750-15% 500 250-20% -25% -30% 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016E -35% Number Of Retail Stores Y/Y Growth Acushnet Holdings Corp. (GOLF) 13

Green-Grass Consolidation A large percentage of Acushnet's revenues are generated by sales to green-grass specialty golf shops and pro shops. With golf courses closures accelerating in the last decade after the boom of the 1990s, we remain concerned that Acushnet is likely to lose key points of distribution as traditional 18-hole courses shrink. Figure 25: Less Golf Courses Suggests Less Rounds Played, Which Would Negatively Impact Acushnet's Potential Revenue Growth Net Addition Of US Golf Courses By Decade 3803 1817 2641 841 492-750 1960s 1970s 1980s 1990s 2000s 2010s Source: National Golf Federation data. Low-Single-Digit Revenue Growth Vehicle Given maturity of distribution and low-growth in the golf category, we expect Acushnet has sustainable low-single-digit revenue growth potential over the next five years. We assume a total revenue CAGR of 2.4% as Acushnet navigates near-term market challenges and a longer-term industry outlook for stable, if tepid, golf market growth. Key assumptions include: $44M in incremental Titleist Golf Ball revenue, a 1.6% CAGR; $63M in incremental Titleist Golf Clubs revenue, a 2.8% CAGR;; $24M in incremental Titleist Golf Gear revenue, a 3.2% CAGR $63M in incremental FootJoy Golfwear revenue, a 2.8% CAGR. Acushnet Holdings Corp. (GOLF) 14

Figure 26: Revenue Bridge by Segment from FY16 to FY21 $1,515 $44 $63 $24 $63 $1,709 $1,515 $44 $63 $24 $63 $1,709 (1.6% CAGR) (2.8% CAGR) (3.2% CAGR) (2.8% CAGR) (2.4% CAGR) FY16E Revenue Titleist Golf Balls Titleist Golf Clubs Titleist Golf Gear FootJoy Golfwear FY21E Revenue Figure 27: Five-Year Revenue Roll-Up 2012A 2013A 2014A 2015A 2016E 2017E 2018E 2019E 2020E 2021E Incremen tal CAGR Titleist Golf Balls 560.1 551.7 543.8 535.5 520.5 531.5 536.8 552.9 558.5 564.0 43.5 1.6% y/y Growth 0.0% -1.5% -1.4% -1.5% -2.8% 1.0% 1.0% 3.0% 1.0% 1.0% Titleist Golf Clubs 398.0 395.7 422.4 388.3 425.7 426.4 447.7 452.2 470.3 489.1 63.4 2.8% y/y Growth 0.0% -0.6% 6.7% -8.1% 9.6% 0.2% 5.0% 1.0% 4.0% 4.0% Titleist Golf Gear 110.0 117.0 127.9 129.4 136.5 140.9 146.5 150.9 155.4 160.1 23.6 3.2% y/y Growth 0.0% 6.4% 9.3% 1.2% 5.5% 3.2% 4.0% 3.0% 3.0% 3.0% FootJoy Golfwear 383.0 395.8 421.6 418.9 432.4 440.6 453.8 467.4 481.4 495.9 63.5 2.8% y/y Growth 0.0% 3.4% 6.5% -0.7% 3.2% 1.9% 3.0% 3.0% 3.0% 3.0% Total Revenue 1451.1 1460.3 1515.7 1472.0 1515.1 1539.4 1584.8 1623.4 1665.6 1709.1 194.0 2.4% y/y Growth 1.8% 4.1% -2.3% 3.4% 1.8% 3.0% 2.5% 2.7% 2.7% Pro Forma EPS $0.90 $1.02 $1.16 $1.20 $1.11 $1.14 $1.25 $1.34 $1.44 $1.54 0.44 6.9% y/y Growth 13.5% 12.8% 4.0% -7.9% 2.9% 10.2% 6.8% 7.5% 7.2% Figure 28: Titleist Golf Clubs and FootJoy Golfwear Are Expected to Add the Most Incremental Revenue Percentage Of Incremental Revenue By Segment 2016-2021 FootJoy Golfwear, 33% Titleist Golf Balls, 22% Titleist Golf Gear, 12% Titleist Golf Clubs, 33% Acushnet Holdings Corp. (GOLF) 15

Figure 29: Titleist Golf Ball Revenue Estimates Titleist Golf Balls ($564M in 2021, $44M Incremental, 22% of Incremental Revenue, 1.6% CAGR) Titleist Golf Balls Revenue $560 $552 $544 $535 $521 $532 $537 $553 $558 $564 2012A 2013A 2014A 2015A 2016E 2017E 2018E 2019E 2020E 2021E Titleist Golf Clubs ($490M in 2021, $63M Incremental, 33% of Incremental Revenue, 2.8% CAGR) Figure 30: Titleist Golf Clubs Revenue Estimates Titleist Golf Clubs Revenue $398 $396 $422 $388 $426 $426 $448 $452 $470 $489 2012A 2013A 2014A 2015A 2016E 2017E 2018E 2019E 2020E 2021E Acushnet Holdings Corp. (GOLF) 16

Titleist Golf Gear ($160M in 2021, $24M Incremental, 12% of Incremental Revenue, 3.2% CAGR) Figure 31: Titleist Golf Gear Revenue Estimates Titleist Golf Gear Revenue $110 $117 $128 $129 $136 $141 $147 $151 $155 $160 2012A 2013A 2014A 2015A 2016E 2017E 2018E 2019E 2020E 2021E FootJoy Golfwear ($496M in 2021, $64M Incremental, 33% of Incremental Revenue, 2.8% CAGR) Figure 32: FootJoy Golfwear Revenue Estimates FootJoy Golfwear Revenue $383 $396 $422 $419 $432 $441 $454 $467 $481 $496 2012A 2013A 2014A 2015A 2016E 2017E 2018E 2019E 2020E 2021E Acushnet Holdings Corp. (GOLF) 17

Margin Opportunity of 180-200bp Given Potential to Leverage Fixed Expenses Our model suggests 180-200bp of operating margin expansion to 12.2% by 2021. We see the opportunity for Acushnet to expand margins modestly going forward given best-in-class manufacturing operations that currently have a high fixed expense base and will be able to leverage on low-single-digit growth going forward. Assumptions for 130bp of Gross Margin Expansion We expect Acushnet to recapture 130bp of gross margin over the next five years, with the gross margin rate expected to reach 51.2% in FY21. Assumptions for 70bp of SG&A Leverage Figure 33: Acushnet Margin Profile and Projections We expect 70bp of SG&A leverage over the next five years from leverage of fixed expenses across operations. 60% Acushnet Margin Profile 50% 40% 30% 20% 10% 0% 8.7% 10.2% 10.4% 11.5% 10.3% 10.7% 11.3% 11.6% 11.9% 12.2% 2012A 2013A 2014A 2015A 2016E 2017E 2018E 2019E 2020E 2021E Operating Margin Gross Margin SG&A % Acushnet Holdings Corp. (GOLF) 18

Balance Sheet Overview Healthy Cash Generation: Acushnet generated $59M in cash and equivalents, and in FY15 it had $836M in debt ($777.1M net debt). We note that in FY15 Acushnet generated $90M cash from operations and $36.1M unlevered free cash flow ($1.89/share, or a 8.1% FCF yield). We expect annual cash from operations to reach $158.6M over the next five years. Lease-Adjusted ROIC: Acushnet's lease-adjusted ROIC was 9.0% in 2015, which is lower than the average 18% ROIC in our softlines coverage universe. Over the next five years, we expect leverage of existing infrastructure to drive Acushnet's lease-adjusted ROIC to 9.7%. Slow-Turning Inventory Affected by Business Seasonality: Acushnet's inventory levels have historically swung due to the seasonality of the golf business as well as its two-year product release cycle. We note that golf equipment is a slow inventory turns business, with total annual turns of 2.2-3.0 times. Acushnet exited 2015 with 156 days of forward inventory. A Levered Balance Sheet Expected to Improve: Exiting 2015, Acushnet had cash on hand of $59.1M and debt outstanding of $836.2M. However, with the roll-off of $362M in convertible notes and $3.1M in post-ipo warrants, we expect net debt to fall to $306.3M. Figure 34: Interest Expense and Debt Breakdown Components Of Interest Expense (Millions) 2Q16 3Q16 4Q16 FY16 Acushnet US - TLA $0 $375 $370 $370 Interest Expense $0.0 ($1.6) ($2.4) ($3.9) Acushnet US - Delayed TLA $0 $0 $0 $0 Interest Expense $0.0 $0.0 $0.0 $0.0 Acushnet US - secured floating rate notes $375 $0 $0 $0 Interest Expense ($4.2) ($1.4) $0.0 ($9.6) Convertible notes $362 $0 $0 $0 Interest Expense ($0.3) $0.0 $0.0 ($0.6) Bonds with common stock warrants $31 $0 $0 $0 Interest Expense ($6.8) ($6.9) ($2.4) ($22.8) Acushnet US - Revolver $20 $10 $38 $38 Interest Expense ($0.6) ($0.2) $0.0 ($1.5) Acushnet Canada $8 $2 $6 $6 Interest Expense ($0.1) ($0.0) ($0.0) ($0.2) Acushnet Europe $12 $0 $0 $0 Interest Expense ($0.1) ($0.0) ($0.0) ($0.2) All other unsecured debt $8 $1 $9 $9 Interest Expense ($0.3) $0.0 $0.0 ($0.4) Capital lease obligations $2 $2 $1 $1 Interest Expense ($0.0) ($0.0) ($0.0) ($0.1) Amortization of Debt Issuance Costs ($1.7) ($5.5) ($0.8) ($9.3) Total Debt $818 $389 $425 $425 Total Interest Expense ($14.1) ($15.6) ($5.6) ($48.6) Figure 35: Balance Sheet Overview Acushnet Holdings Corp. Balance Sheet Overview FY14 FY15 Y/Y Inventories Sales $1,537.6 $1,503.0-2.3% Inventories $291.1 $326.4 12.1% Days Inventory 146 153 7 Cash Management Receivables $197.7 $192.4 -$5.3 DSOs 47 47 0 Payables $94.0 $89.9 -$4.2 DPOs 44 45 1 Cash Cycle 149 155 6 Cash Cash $53.8 $59.1 $5.4 Debt $905.3 $836.2 -$69.1 Net Cash $959.1 $895.3 -$63.8 Acushnet Holdings Corp. (GOLF) 19

Valuation Methodology Our target price of $20 is based on an equal weighted average of: A comparable valuation relative to peers (1/3, $20); Discounted cash flow analysis (1/3, $22); Long-term growth driver model (1/3, $19). Figure 36: Valuation Methodology Source: Credit Suisse estimates. Valuation Weighting Price Comparable Multiples 33.3% $20 DCF 33.3% $22 Long-Term Growth Driver 33.3% $19 12-Month Price Target $20 Comparable Multiples We considered a peer group of: Figure 37: Comparable Multiple Valuation Buckets Hardware companies that are also in the consumable sporting equipment space (Amer Sports, Callaway Golf, Giant Manufacturing, Honma Golf Ltd., Mizuno Corp, Shimano In, Vista Outdoor Inc., etc.): Forward P/E multiple of 16x Footwear Vendors with brands in the same space as FootJoy (adidas, Asics, Nike, Skechers, etc.): Forward P/E multiple of 15x Athletic Apparel (Columbia, lululemon, Under Armour, VF Corp): Forward P/E multiple of 21x Slow growth lifestyle brands with similar low-single-digit revenue growth as the Titleist and FootJoy brands (Caleres, Crocs, Deckers Outdoor, Rocky Brands, Ralph Lauren, etc.): Forward P/E multiple of 15x Comparable Multiple Valuation Buckets 21.1x 16.4x 11.0x 14.7x 11.9x 11.9x 14.7x 8.9x Hardware Footwear Vendors Athletic Slow Growth Lifestyle Forward P/E Forward TEV/EBITDA Source: Credit Suisse estimates. Acushnet Holdings Corp. (GOLF) 20

Figure 38: Comparable Multiples Analysis Sheet Price Mkt Cap P/E TEV/EBITDA Sector/Company Ticker 11/21 (mn) CY15 CY16 CY17 CY15 CY16 CY17 Acushnet Holdings Corp. $22.50 1667.2 18.7x 20.3x 19.7x 9.8x 9.7x 9.1x CY17 P/E for Peers 16.4x CY17 TEV/EBITDA for Peers 10.0x Hardware Companies Amer Sports Oyj AMEAS.HE $26.60 3125.5 21.4x 19.7x 16.4x 13.8x 12.8x 11.1x Brunswick Corp BC $46.90 4310.1 16.4x 13.5x 11.8x 8.4x 7.4x 6.5x Black Diamond Inc BDE.OQ $5.95 178.9 59.5x NM 40.3x 39.5x NM 12.7x Dorel Industries Inc DIIB.TO $27.81 907.0 17.4x 12.4x 10.4x 8.7x 7.6x 7.0x Escalade Inc ESCA.O $14.00 200.9 16.7x 18.7x 16.0x 12.2x 11.8x 11.0x Callaway Golf Co ELY $12.24 1151.6 85.1x 24.0x 31.1x 23.1x 16.5x 13.5x Fox Factory Holding Corp FOXF.OQ $22.80 861.5 23.5x 18.8x 16.8x 14.3x 13.2x 11.8x Giant Manufacturing Co Ltd 9921.TW $5.82 2186.3 18.3x 21.2x 19.2x 12.2x 13.9x 12.7x Harley-Davidson Inc HOG $58.14 10425.7 16.0x 15.0x 13.8x 12.1x 12.8x 12.1x Honma Golf Limited 6858.HK $0.97 588.9 18.1x 16.4x 15.0x 19.9x 18.1x 16.5x Johnson Outdoors Inc JOUT.O $41.00 404.3 38.7x 24.4x 20.8x 11.3x 7.7x 7.4x Mizuno Corp 8022.T $5.05 636.6 26.7x 26.7x 22.2x 12.2x 10.9x 9.6x Nautilus Inc NLS $17.60 552.4 19.3x 15.6x 14.4x 11.6x 9.4x 8.3x Newell Brands Inc NWL $46.74 22725.0 21.4x 16.2x 15.6x 33.9x 14.3x 12.2x Polaris Industries Inc PII $83.93 5457.7 12.5x 24.1x 16.6x 6.5x 10.8x 8.5x Performance Sports Group Ltd PSG $1.66 75.6 4.5x 58.0x 4.5x 9.1x 12.5x 8.6x Rapala VMC Corp RAP1V.HE $4.42 169.6 18.1x 16.3x 14.5x 9.4x 10.5x 9.2x Sturm Ruger & Company Inc RGR $53.20 1021.7 17.3x 18.1x 18.9x 7.5x 7.9x 8.2x Thule Group AB THULE.ST $14.39 1453.0 20.3x 19.1x 17.3x 15.6x 14.6x 13.3x Shimano Inc 7309.T $164.28 14084.0 22.7x 32.7x 28.1x 15.0x 16.8x 14.6x Vista Outdoor Inc VSTO.N $40.02 2403.4 16.2x 15.3x 13.5x 10.2x 9.2x 8.3x 24.3x 21.3x 18.0x 14.6x 11.9x 10.6x Median 18.3x 18.7x 16.4x 12.2x 12.1x 11.0x Vendors / Retailers Footwear adidas AG ADSGn.F $146.93 30323.6 38.2x 28.6x 24.7x 18.9x 15.7x 13.8x Asics Corp 7936.T $21.58 4333.2 49.6x 31.3x 23.2x 14.9x 14.0x 12.0x Caleres Inc CAL $27.72 1169.4 14.2x 13.7x 12.4x 6.4x 6.2x 5.8x Crocs Inc CROX.O $8.29 609.3 NM NM 67.7x 11.8x 10.4x 6.6x Deckers Outdoor Corp DECK.K $61.37 1989.7 13.6x 14.5x 13.7x 8.6x 8.8x 8.5x Nike Inc NKE $51.10 87324.8 25.6x 22.4x 20.0x 16.7x 15.7x 14.1x Rocky Brands Inc RCKY.O $11.20 84.1 10.7x 62.2x 12.8x 5.6x 10.9x 6.5x Steven Madden Ltd SHOO.O $38.05 2257.5 20.5x 18.8x 17.3x 11.5x 11.3x 10.6x Skechers USA Inc SKX $22.23 3450.2 14.7x 13.6x 12.5x 7.1x 6.5x 6.1x Wolverine World Wide Inc WWW $23.88 2314.0 17.0x 17.8x 15.6x 10.0x 11.0x 10.0x Mean 16.6x 23.3x 21.5x 11.1x 11.1x 9.4x Median 14.7x 17.8x 14.7x 9.3x 10.7x 7.5x Athletic Apparel Columbia Sportswear Co COLM.O $58.37 4122.7 25.2x 22.2x 20.1x 13.2x 12.3x 11.3x Lululemon Athletica Inc LULU.O $54.61 7494.1 30.1x 26.0x 22.1x 16.2x 14.1x 12.3x Under Armour Inc UA $30.95 13799.2 59.5x 51.6x 44.7x 28.8x 25.0x 21.0x VF Corp VFC $54.52 22857.0 17.4x 17.4x 15.9x 11.7x 12.5x 11.5x Mean 33.0x 29.3x 25.7x 17.5x 16.0x 14.0x Median 27.6x 24.1x 21.1x 14.7x 13.3x 11.9x Slow Growth Lifestyle Brands Caleres Inc CAL $27.72 1169.4 14.2x 13.7x 12.4x 6.4x 6.2x 5.8x Columbia Sportswear Co COLM.O $58.37 4122.7 25.2x 22.2x 20.1x 13.2x 12.3x 11.3x Crocs Inc CROX.O $8.29 609.3 NM NM 67.7x 11.8x 10.4x 6.6x Deckers Outdoor Corp DECK.K $61.37 1989.7 13.6x 14.5x 13.7x 8.6x 8.8x 8.5x HanesBrands Inc HBI $24.61 9414.8 14.7x 12.9x 11.4x 13.4x 12.4x 11.3x Ralph Lauren Corp RL $110.28 9175.3 16.6x 19.4x 18.9x 8.2x 9.4x 9.3x Rocky Brands Inc RCKY.O $11.20 84.1 10.7x 62.2x 12.8x 5.6x 10.9x 6.5x Wolverine World Wide Inc WWW $23.88 2314.0 17.0x 17.8x 15.6x 10.0x 11.0x 10.0x 16.0x 23.2x 21.6x 9.6x 10.2x 8.6x 14.7x 17.8x 14.7x 9.3x 10.7x 8.9x Sporting Goods Retail Big 5 Sporting Goods Corp BGFV.O $19.55 424.9 26.9x 25.6x 19.8x 12.5x 9.4x 8.5x Cabela's Inc CAB $61.63 4256.9 21.5x 21.5x 18.8x 19.3x 18.3x 16.3x Canadian Tire Corporation Ltd CTCa.TO $104.41 7532.5 18.4x 15.5x 14.0x 9.9x 9.0x 8.5x Dick's Sporting Goods Inc DKS $58.02 6488.1 20.1x 18.9x 15.6x 9.0x 8.8x 7.5x Hibbett Sports Inc HIBB.O $40.40 896.3 14.1x 13.8x 13.0x 6.7x 6.9x 6.6x Liberty Media Corp LMCA.O $33.01 11124.4 85.9x 14.8x NM 11.8x NM NM Mean 31.2x 18.3x 16.2x 11.5x 10.5x 9.5x Median 20.8x 17.2x 15.6x 10.8x 9.0x 8.5x Source: Credit Suisse estimates, Thomson Reuters Eikon. Acushnet Holdings Corp. (GOLF) 21

Long-Term Growth Model Our baseline model reflects previously outlined long-term assumptions, suggesting opportunity for $1.54 in EPS. Assuming a multiple of 16x on this long-term EPS estimate, discounted by a cost of capital of 8%, we see a 12-month share price of $19 as achievable. Figure 39: Long-Term Potential for $1.54 in EPS By FY21 ($M, except EPS) 2012A 2013A 2014A 2015A 2016E 2017E 2018E 2019E 2020E 2021E Revenue $1,451.1 $1,477.2 $1,537.6 $1,503.0 $1,554.5 $1,582.2 $1,630.2 $1,671.5 $1,716.6 $1,763.1 Gross Profit $699.6 $736.5 $759.5 $776.6 $776.6 $797.9 $825.4 $849.7 $876.0 $903.3 SG&A $573.4 $585.4 $600.3 $603.6 $616.5 $628.5 $640.9 $655.3 $671.1 $687.4 Operating Profit $126.2 $151.0 $159.2 $173.0 $160.2 $169.4 $184.5 $194.4 $204.9 $215.9 Non-operating Income -$24.0 -$34.1 -$26.4 -$21.6 -$21.8 -$16.3 -$13.7 -$11.2 -$8.6 -$6.1 Pre-Tax Income $102.2 $116.9 $132.8 $151.3 $138.3 $153.1 $170.8 $183.2 $196.3 $209.9 EPS $0.90 $1.02 $1.16 $1.20 $1.11 $1.14 $1.25 $1.34 $1.44 $1.54 Y/Y Growth Rev. 1.8% 4.1% -2.3% 3.4% 1.8% 3.0% 2.5% 2.7% 2.7% Y/Y Growth EPS 13.5% 12.8% 4.0% -7.9% 2.9% 10.2% 6.8% 7.5% 7.2% Gross Margin 48.2% 49.9% 49.4% 51.7% 50.0% 50.4% 50.6% 50.8% 51.0% 51.2% SG&A % 39.5% 39.6% 39.0% 40.2% 39.7% 39.7% 39.3% 39.2% 39.1% 39.0% Operating Margin 8.7% 10.2% 10.4% 11.5% 10.3% 10.7% 11.3% 11.6% 11.9% 12.2% Tax Rate 38% 38% 37% 39% 38% 42% 41% 41% 41% 41% Share Count (M) 65.8 66.8 69.4 72.2 74.0 74.7 76.1 76.7 76.7 76.7 Implied Stock Price $27.02 Long-Term P/E Multiple 16.0x Discount Rate 8.0% Discounted Stock price $19 Source: Credit Suisse estimates. Acushnet Holdings Corp. (GOLF) 22

Discounted Cash Flow Analysis Our five-year discounted cash flow model suggests modest upside potential to the current valuation. Using a 8.0% weighted average cost of capital and a 18.0x terminal cash multiple (implying a terminal 7.9x TEV/EBITDA multiple), our discounted cash flow model yields a $22 target price. Figure 40: Five-Year DCF 5 Year DCF Value Drivers (units in millions) DCF Valuation WACC 8.0% PV of Cash Flows $414.8 Terminal Multiple 18X PV of Terminal Value $1,541.0 Terminal TEV/EBITDA Multiple 7.9X Net Cash -$355.4 Equity Value $1,600.3 Equity Value Per Share $21.60 Basic Shares Outstanding 74.1 (Units in millions) FY15 FY16E FY17E FY18E FY19E FY20 FY21E 0 0.5 1.5 2.5 3.5 4.5 5.5 Revenue $1,503.0 $1,554.5 $1,582.2 $1,630.2 $1,671.5 $1,716.6 $1,763.1 Operating Income 173.0 160.2 169.4 184.5 194.4 204.9 215.9 Operating Margins 11.5% 10.3% 10.7% 11.3% 11.6% 11.9% 12.2% Taxes 59.5 52.5 63.7 70.6 75.3 80.2 85.2 Tax Rate 34% 33% 38% 38% 39% 39% 39% NOPAT 113.5 107.6 105.7 113.9 119.1 124.7 130.7 Depreciation and Amortization 41.7 40.7 41.5 40.5 38.5 36.9 35.9 Change in Working Capital 1.8-38.9-170.0-26.3-25.4-24.6-24.2 Capital Expenditures -23.2-25.1-27.6-28.3-29.3-30.3-31.4 Free Cash Flow 133.8 84.4-50.5 99.8 102.9 106.7 111.0 PV of Free Cash Flow $133.8 $81.2 -$45.0 $82.3 $78.6 $106.7 $111.0 Source: Credit Suisse estimates. Acushnet Holdings Corp. (GOLF) 23

Investment Risks Unpredictable Weather Adds Seasonality Risk: The company plays in a highly seasonal category, with significant weather risk, particularly in late 1Q and early 2Q, which is when golf rounds have historically peaked. Weather conditions in Acushnet's primary geographic markets prevent golf from being played in cold weather months and occasionally in hot weather months. This could decrease the number of golf rounds played as well as the amount spent by golfers on related-products. Retail Channel Challenged as Key Vendors Exit and Major Retailers Are Navigating Bankruptcy: Golf products are sold through big-box golf retail concepts, like Golf Galaxy and Golfsmith. Both concepts have historically generated profits inconsistently at low returns. With bankruptcy proceedings under way for Golfsmith as of September 2016, sales into a large distribution channel are likely to be disrupted over the next year. We expect that with the potential liquidation of inventory through big-box retail concepts due to the exit of key brands such as Nike and adidas TaylorMade could additionally disrupt inventory channels in the near term. Golf Course Consolidation Reduces Points of Distribution: The number of golf courses in the U.S. is declining following significant expansion over the past 25 years. The National Golf Federation estimates that between 2010 and 2020, approximately 750 golf courses could be closed in the United States. Golf course closures could particularly impact Acushnet, as (1) sales are substantially generated from golf-related products such as golf balls, golf apparel, and golf clubs, and (2) course closures reduce the potential green-grass sale distribution points for Acushnet in its largest market. Demographic Factors Could Affect Future Participation Rates. Leisure and sports-related spending has shifted away from traditional 18-hole golf courses for younger consumers, which could lead to declining golf participation. This could be due to socioeconomic reasons, as golf is a recreational activity that requires both time and money. If interest in the sport continues to fall, it could negatively impact Acushnet's ability to sell product. Macroeconomic Conditions Can Affect Discretionary Spend: Spend related to golf products are recreational in nature and discretionary purchases for consumers. Therefore, consumers are generally more willing to spend time and money on golf when economic conditions are favorable. Unfavorable macroeconomic conditions due to the stock market, housing prices, interest rates, the availability of credit, and confidence in future economic conditions could postpone or reduce golf-related purchases. Acushnet Holdings Corp. (GOLF) 24

Company Overview Channel Mix Figure 41: Mix Skewed Heavily to North America Acushnet products are distributed to over 30,000 wholesale accounts worldwide, with e-commerce direct sales in 46 countries. Most of Acushnet's sales are indexed to premium green-grass golf shops and points of distribution, with the remainder to specialty big-box retailers. We expect the company to continue focusing on wholesale sales for the next five years. North America makes up the majority of the company's revenue by geography (58%), followed by EMEA (29%) and APAC, specifically Korea and Japan (13%). While the United States remains the company's most important market, we believe it will be looking for expansion opportunities in growth markets, especially China, Japan, and South Korea. Acushnet Geographic Mix 13% 29% 58% Americas EMEA Asia Pacific Product Mix Acushnet offers products in four categories: golf balls (36%), golf clubs (26%), golf wear (28%), and golf gear (9%). Within these product categories, Acushnet offers various product lines at various price points, targeting different customers and lifestyles. Golf Balls: This segment includes the premium Pro V1 and Pro V1x lines, as well as the Pinnacle, NXT, Velocity, and DT lines. Golf Clubs: This segment includes Titleist-brand drivers, fairways, hybrids, and irons. Additionally, Acushnet manufactures Vokey-designed wedges and the Scotty Cameron-designed putter. Golf Wear: Comprising apparel under the FootJoy brand, the brand currently has #1 market share in golf shoes and golf gloves. Golf Gear: This includes Titleist-branded golf bags, hats, golf gloves, travel equipment, and accessories. Of the golf bag business, 55% is through green-grass channels and 59% of the golf hat business is through the green-grass channel. Acushnet Holdings Corp. (GOLF) 25

Figure 42: Product Mix Skews to Balls, with Consumables Moderating Acushnet Operating Segment Mix 9% 1% 28% 36% 26% Balls Clubs FootJoy Golf Wear Gear Other Source: Company data. Figure 43: Titleist Product Mix Titleist Product Mix 3% 12% Figure 44: FootJoy Product Mix FootJoy Product Mix 26% 36% 49% 21% 53% Balls Clubs Gear Other Shoes Gloves Apparel Source: Company data. Source: Company data. Acushnet Holdings Corp. (GOLF) 26