The golf industry in the United States is experiencing a remarkable expansion, as detailed by the National Golf Foundations latest research. In 2023, an astounding 45 million Americans, aged six and above, are participating in the sport. This figure encompasses approximately 26.6 million golfers playing on traditional courses and another 18.4 million enjoying golf at off-course venues such as simulators and popular entertainment venues like Topgolf. This growth trend has seen nearly 2 million new golfers introduced each year over the past decade, with a projected 3.4 million first-time players anticipated in 2023 alone.

Among these players, young adults aged 18 to 34 form the largest demographic group, with 6.3 million actively participating on the course and an additional 5.8 million engaging in off-course activities. Impressively, junior participation has surged to 3.5 million, marking a significant 40% increase since 2019, with girls comprising 37% of this group. Female participation in golf has also seen a notable rise, with 7 million women accounting for 26% of on-course golfers. In 2023, the total number of rounds played reached a record high of 531 million, exceeding the pre-pandemic average by more than 10%. This growth is underscored by the availability of 16,000 golf courses across 14,000 facilities in the U.S., with 75% of these courses open to the public. Despite a 12% decrease in course supply since 2006, there remains a high demand, as 22.4 million people express a desire to hit the greens.

The golf landscape is evolving continuously, driven by factors such as increasing female participation, the popularity of social play, accessibility to lessons, and the convenience of online bookings. A report by NBC Sports Next highlights that female engagement in the sport has grown by 15%, with 800,000 more women joining between 2020 and 2022, compared to a modest 2% increase among male golfers during the same period. Currently, women represent one-third of junior players and constitute 49% of surveyed golfers. Golf's social aspect remains integral, with 49% of respondents indicating they primarily play with friends. Additionally, business-related golfing is gaining traction, especially among users of platforms like GolfNow. While 36% of golfers participated in a lesson over the past year, this figure rose to 67% among GolfNow customers, who often prefer a blend of on-course and facility-based training. Younger golfers are increasingly using online booking options, with 43% of those aged 18 to 34 reserving at least one round in 2023. The convenience of online bookings is crucial, as 55% of golfers cite it as the fastest option available. These trends indicate a significant opportunity for golf courses that cater to women, social players, and those comfortable with digital platforms.

Furthermore, the golf industry also includes publicly traded companies that offer various services, from manufacturing golf equipment to operating golf courses. This market presents investors with the chance to engage with the golf industry. Recently, a list was published highlighting the 10 Best Golf Stocks to Buy According to Analysts, and among them is Toll Brothers, Inc. (NYSE:TOL), a prominent player in the golf sector.

Looking ahead, the newly established golf league known as TGL is set to redefine the sport by launching matches in January 2025. This league aims to blend digital and physical elements to create a new, hybrid golfing experience. Teams of golfers will compete in a specially designed venue featuring custom-made holes. The format begins with players hitting a large-screen simulator that replicates real terrain, then transitions to a transformable turntable serving as the green. Broadcast innovations are central to this concept, aimed at enhancing the viewing experience for home audiences from the outset. The 2025 PGA Merchandise Show in Orlando underscored the golf industrys robust momentum.

Marc Simon, Vice President of PGA Golf Exhibitions, remarked, The show reflects the industry, and golf is currently thriving. With the surging popularity of the sport, we witnessed the largest number of exhibitors and the most expansive occupied space since 2009, which is an encouraging sign. The exhibition featured over 1,000 exhibitors occupying 1.1 million square feet, showcasing golf's continued evolution within the $102 billion industry. More than 1,200 VIP buyers from 770 golf courses and mass merchandisers attended, boasting a collective purchasing power of $810 million and a potential for roughly $2 billion in retail sales. The event's scope has transcended traditional golf equipment, now encompassing fitness, health, wellness, and even racquet sports.

Technology emerged as a focal point during the show, with AI-driven golf simulators, advanced ball-flight tracking data, and next-generation golf carts catering to the growing trend of personal cart ownership. The trends within golf are shifting, highlighted by the attendance of a record 200 influencers and considerable growth in golf apparel driven by Gen Z consumers. The PGA Shows transformation aligns with industry trends emphasizing experiential marketing and innovation. Looking forward, organizers plan to remain responsive to evolving market demands to ensure the golf industry's sustained success.

In our exploration of golf stocks, we compiled a list of 12 companies within the golf sector, from which we ranked the top 10 based on their potential upside as of April 9, 2025. We focused on stocks with an upside potential of 10% or more, ranked in ascending order.

One of the most notable companies in our rankings is Toll Brothers, Inc. (NYSE:TOL), which stands at the forefront of our list of the best golf stocks. This company specializes in developing communities that feature leisure amenities, including golf courses. Toll Brothers prides itself on owning a substantial portion of premium land within the industry, allowing it to offer luxurious and customizable designs that command top-tier prices compared to its public peers.

In the first quarter, Toll Brothers reported impressive growth, signing 2,307 net contracts totaling $2.3 billion, which represents a 13% increase in units and a 12% rise in dollar value compared to the previous year. The company has demonstrated strong buyer commitment, with a low contract cancellation rate of just 2.4% of the initial backlog. Profitability has also improved, with the adjusted gross margin soaring to 26.9%, exceeding expectations by 65 basis points. Moreover, the deposit conversion ratio reached 82%, significantly higher than the five-year average of 70%, indicating strong customer retention. The firm maintains a solid land position, owning or controlling nearly 56,000 lots, with 56% of these under option, providing it with flexibility in land acquisitions.

To enhance its financial standing, Toll Brothers extended the maturities of its credit facilities until February 2030 and increased the size of its revolving credit facility to $2.35 billion, thereby bolstering both liquidity and long-term financial stability.

The Baron Real Estate Fund addressed Toll Brothers in its Q4 2024 investor letter, noting, As mentioned in this letter, we chose to reduce the Funds homebuilder exposure in D.R. Horton, Inc., Lennar Corporation, and Toll Brothers, Inc. following exceptional share price performance over the last two years. From September 30, 2022, to September 30, 2024, shares of Toll Brothers, Lennar, and D.R. Horton increased by 269%, 155%, and 184%, respectively. Homebuilder valuations for our investments approached peak values from previous cycles, at or above two times tangible book value. We are also concerned that the recent 100 basis point increase in interest rates could further impact housing affordability, potentially leading to stagnating home prices and heightened incentives for homebuilders to attract buyers. Additionally, new administration policies regarding tariffs, immigration, and deportation may elevate costs for labor and materials. These factors may pressurize homebuilder gross margins in 2025.

In summary, Toll Brothers ranks third on our list of the best golf stocks to buy according to analysts. While we acknowledge the potential of golf companies, we believe that AI stocks may offer greater promise for delivering higher returns in a shorter timeframe. For those interested in an AI stock that has shown promise since the onset of 2025, while other popular AI stocks have declined by about 25%, we invite you to check out our report on the most affordable AI stock currently available.

In conclusion, it is an exciting time for the golf industry, marked by unprecedented participation rates and innovative adaptations. As we look ahead, the fusion of technology with traditional golfing experiences will undoubtedly play a pivotal role in shaping the future of this beloved sport.