NEW YORK (TheStreet) -- Shares of Callaway Golf  (ELY - Get Report)  were increasing in late-afternoon trading on Thursday as CEO Chip Brewer may be looking to claim athlete sponsorships and business left open after Nike's (NKE) decision to drop golf club, ball and bag sales last month. 

The Carlsbad, CA-based golf-equipment manufacturer is looking to approach Nike-sponsored athletes and country-club pros who market Nike gear to amateur players, according to Bloomberg.

Nike decided to only sell golf apparel and footwear after the sportswear giant's sales in its golf business fell 8% to $706 million for the fiscal year ended May 31. It was the worst-performing business for Nike in terms of sales last fiscal year.

Callaway saw year-over-year increases in three of its four golf equipment divisions in 2015, with revenue from golf balls, putters and irons gaining since 2014.

Now, Brewer said the company is exploring the possibility of adding several sponsorship positions, but maintained that Callaway will be "selective," Bloomberg noted. Popular athletes such as Rory McIlroy, Michelle Wie and Tiger Woods all use Nike clubs.

Brewer added that it's unlikely that Callaway would make a bid for Adidas' (ADDYY) TaylorMade golf unit, which the company said it was putting up for sale in May.

Callaway announced this week that it's buying Toulon Design, a California-based putter manufacturer. Brewer noted that the company plans to boost spending on marketing and research and development as it attempts to reach more millennial consumers.

Shares of Nike were higher in late afternoon trading on Thursday.

Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:

The team rates Callaway Golf as a Buy with a ratings score of B. This is driven by several positive factors, which it believes should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks the team covers. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and good cash flow from operations. Although the company may harbor some minor weaknesses, it feels they are unlikely to have a significant impact on results.

You can view the full analysis from the report here: ELY

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