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Churchill Downs (CHDN)
:CHDN
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Churchill Downs (CHDN) AI Stock Analysis

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Churchill Downs

(NASDAQ:CHDN)

Rating:76Outperform
Price Target:
$121.00
▲(14.52%Upside)
Churchill Downs' solid financial performance, strong cash flow management, and strategic acquisitions are key strengths. The technical indicators suggest short-term bullish momentum, though caution is advised due to longer-term indicators and economic uncertainties affecting future projects.
Positive Factors
Earnings
The company reported revenue and Adj. EBITDA above both internal estimates and the Street's expectations.
Share Repurchase
The company approved a new $500M share repurchase program, replacing the existing program, which is viewed as a positive signal for when management is able to buy shares.
Unique Growth Potential
Churchill Downs is seen as one of the best growth stories in gaming, increasing EBITDA at an 8% CAGR from 2023 to 2026, making it a top pick in the coverage universe.
Negative Factors
Attendance and Sentiment
Despite the increase in wagering, attendance for the Derby was approximately 147K, down 6% year-over-year, affecting overall sentiment negatively.
Capital Projects Deferral
The solid performance is likely overshadowed by the separate announcement of deferral of the previously announced longer-term capital projects at CDRT.
Cost Pressures
Salaries and benefit costs were elevated, largely due to Rose development, impacting margins.

Churchill Downs (CHDN) vs. SPDR S&P 500 ETF (SPY)

Churchill Downs Business Overview & Revenue Model

Company DescriptionChurchill Downs Incorporated (CHDN) is a leading racing, online wagering, and gaming entertainment company that operates in the United States. Best known for its iconic flagship event, the Kentucky Derby, held at Churchill Downs Racetrack in Louisville, Kentucky, the company also owns and operates additional racetracks and casinos, offering a diverse range of entertainment options. Additionally, Churchill Downs Incorporated is involved in online gaming and provides advanced deposit wagering through its TwinSpires platform.
How the Company Makes MoneyChurchill Downs Incorporated generates revenue through several key streams. The company's primary revenue sources include admissions, pari-mutuel wagering, and gaming operations. The flagship event, the Kentucky Derby, significantly contributes to its admissions and wagering earnings due to its popularity and high attendance. The company also earns money through its TwinSpires platform, which facilitates online wagering for horse racing and other sporting events. Furthermore, Churchill Downs operates several casinos and racetracks across the United States, which contribute gaming and pari-mutuel revenues. Partnerships with media companies and sponsorships during major racing events also enhance its revenue potential. The diverse portfolio of entertainment and wagering options allows Churchill Downs Incorporated to capitalize on multiple aspects of the racing and gaming industry.

Churchill Downs Earnings Call Summary

Earnings Call Date:Apr 23, 2025
(Q1-2025)
|
% Change Since: 0.59%|
Next Earnings Date:Jul 23, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted record financial performance and successful project completions, such as the Owensboro HRM venue and Kentucky Derby enhancements. However, challenges included a pause on a major project due to economic uncertainties and softness in certain segments. The company remains committed to strategic growth and capital management.
Q1-2025 Updates
Positive Updates
Record First Quarter Financial Performance
Churchill Downs Incorporated delivered record first quarter net revenue of $643 million and record first quarter adjusted EBITDA of $245 million, marking strong performance despite various challenges.
Successful Opening of Owensboro HRM Venue
The Owensboro HRM venue was opened on time and below budget, featuring 600 HRMs, a retail sportsbook, and simulcast wagering. The property is on track to deliver a great return for shareholders.
Completion of Kentucky Derby Starting Gate Pavilion
The Starting Gate Pavilion and Courtyard project was completed on time and on budget, adding 8,500 new reserved premium stadium and trackside box seats, enhancing the guest experience.
HRM Expansion and Performance
Significant progress in HRM venues, with new developments in Virginia and Kentucky, including the Richmond expansion and the forthcoming Roshire Gaming Parlor. The Exacta technology acquisition has improved performance and expanded third-party operations.
Strong Free Cash Flow Generation
Generated $234 million or $3.15 per share of free cash flow in the first quarter, indicating robust cash flow from operations.
Negative Updates
Temporary Pause on $900 Million Project
The multiyear project at Churchill Downs Racetrack has been paused due to increased economic uncertainty and potential inflation, particularly affecting material costs.
Softness in Virginia HRM Properties
The Virginia HRM property's contribution to adjusted EBITDA decreased by $2.2 million or 3% compared to the prior year, affected by weather, a higher handle tax rate, and competition.
Impact of Economic Uncertainty on Consumer Behavior
Notable hesitancy observed in lower-tier or unrated play across casinos, attributed to the volatile macroeconomic environment and uncertainty over tariffs.
Reduced Project Capital Forecast
2025 project capital forecast reduced by $100 to $110 million due to the pause on large-scale projects, reflecting a cautious approach to capital allocation.
Company Guidance
During the Churchill Downs Incorporated 2025 First Quarter Earnings Conference Call, the company reported record first quarter net revenue of $643 million and record first quarter adjusted EBITDA of $245 million, despite challenges such as material weather events, an uncertain economic environment, and one less day in the quarter due to 2024 being a leap year. The Owensboro HRM venue opened successfully on time and below budget, contributing positively to the results. The company decided to temporarily pause a $900 million multiyear project at Churchill Downs Racetrack due to economic uncertainties and potential cost increases, but announced two smaller renovation projects at a cost of $25 to $30 million. The Virginia HRM properties showed mixed results with a decrease in adjusted EBITDA, but the Rose Gaming Resort demonstrated good progress. The company generated $234 million or $3.15 per share of free cash flow in the first quarter, with reduced 2025 capital expenditure projections due to the paused project. They repurchased nearly 800,000 shares and paid dividends, returning almost $120 million to shareholders. Overall, the company remains committed to strategic investments and expects the upcoming 151st Kentucky Derby to deliver results comparable to the previous year.

Churchill Downs Financial Statement Overview

Summary
Churchill Downs shows strong financial performance with consistent revenue growth and healthy profit margins. The company demonstrates strong cash flow management and efficient equity utilization despite high leverage. However, the balance sheet reflects moderate leverage, which poses potential risks.
Income Statement
85
Very Positive
Churchill Downs shows strong financial performance with consistent revenue growth and healthy profit margins. The TTM (Trailing-Twelve-Months) Gross Profit Margin is approximately 50.1%, and the Net Profit Margin stands at 15.1%. EBIT and EBITDA margins are also robust at 25.8% and 33.9%, respectively. Revenue has grown steadily over the years, reflecting a positive growth trajectory.
Balance Sheet
70
Positive
The balance sheet reflects moderate leverage with a Debt-to-Equity Ratio of 4.55 and a Return on Equity of 39.4%, indicating efficient use of equity but potential risk due to high debt levels. The Equity Ratio stands at 14.6%, showing a relatively low proportion of assets financed by shareholders' equity.
Cash Flow
78
Positive
Churchill Downs demonstrates strong cash flow management with a Free Cash Flow Growth Rate of 64.6% over the TTM. The Operating Cash Flow to Net Income Ratio is 1.81, and the Free Cash Flow to Net Income Ratio is 0.88, highlighting effective cash generation relative to earnings.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue2.73B2.46B1.81B1.60B1.05B
Gross Profit938.50M795.70M566.40M446.10M193.50M
EBITDA1.07B1.01B875.10M536.80M185.90M
Net Income426.80M417.30M439.40M249.10M13.30M
Balance Sheet
Total Assets7.41B6.96B6.21B2.98B2.69B
Cash, Cash Equivalents and Short-Term Investments175.50M144.50M129.80M291.30M67.40M
Total Debt4.92B4.84B4.61B1.97B1.62B
Total Liabilities6.17B6.06B5.66B2.67B2.32B
Stockholders Equity1.08B893.60M551.50M306.80M367.10M
Cash Flow
Free Cash Flow225.70M-70.70M80.00M243.70M-92.30M
Operating Cash Flow772.70M605.80M536.80M335.50M141.90M
Investing Cash Flow-545.20M-718.00M-3.10B-100.40M-239.40M
Financing Cash Flow-196.60M129.30M2.42B-500.00K76.00M

Churchill Downs Technical Analysis

Technical Analysis Sentiment
Positive
Last Price105.66
Price Trends
50DMA
99.58
Positive
100DMA
102.38
Positive
200DMA
117.80
Negative
Market Momentum
MACD
1.88
Positive
RSI
59.12
Neutral
STOCH
58.37
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CHDN, the sentiment is Positive. The current price of 105.66 is above the 20-day moving average (MA) of 103.84, above the 50-day MA of 99.58, and below the 200-day MA of 117.80, indicating a neutral trend. The MACD of 1.88 indicates Positive momentum. The RSI at 59.12 is Neutral, neither overbought nor oversold. The STOCH value of 58.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CHDN.

Churchill Downs Risk Analysis

Churchill Downs disclosed 29 risk factors in its most recent earnings report. Churchill Downs reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Churchill Downs Peers Comparison

Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
BYBYD
80
Outperform
$6.69B13.4235.62%0.85%6.06%10.05%
76
Outperform
$7.62B18.7944.13%0.39%11.75%24.31%
MGMGM
71
Outperform
$10.12B16.6621.38%2.76%-14.31%
69
Neutral
$11.16B29.14-51.73%0.94%-0.08%-48.66%
CZCZR
64
Neutral
$6.22B-5.56%-1.25%-130.83%
58
Neutral
$2.72B-2.81%5.51%92.46%
57
Neutral
HK$25.55B4.08-2.03%5.79%-0.31%-67.64%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CHDN
Churchill Downs
105.66
-34.67
-24.71%
BYD
Boyd Gaming
82.56
23.56
39.93%
MGM
MGM Resorts
37.17
-6.60
-15.08%
PENN
PENN Entertainment
18.33
-0.39
-2.08%
WYNN
Wynn Resorts
106.36
23.76
28.77%
CZR
Caesars Entertainment
29.81
-6.62
-18.17%

Churchill Downs Corporate Events

M&A TransactionsBusiness Operations and Strategy
Churchill Downs Acquires Majority Stake in Casino Salem
Positive
Jul 14, 2025

On July 14, 2025, Churchill Downs Incorporated announced definitive agreements to acquire 90% of Casino Salem in New Hampshire for $180 million. This acquisition allows CDI to develop a charitable gaming, entertainment, and dining destination featuring historical horse racing machines. Local developers Joe Faro and Sal Lupoli will retain a 10% stake, contributing their expertise to the project. The initial phase of Casino Salem opened on July 9, 2025, and CDI plans to expand the venue further, aiming to draw patrons from the New England market and support local charitable organizations. The transaction is expected to close in the third quarter of 2025, pending regulatory approval.

The most recent analyst rating on (CHDN) stock is a Buy with a $167.00 price target. To see the full list of analyst forecasts on Churchill Downs stock, see the CHDN Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
Churchill Downs EVP Maureen Adams Announces Retirement
Neutral
Jun 26, 2025

On June 25, 2025, Maureen Adams, Executive Vice President of Gaming Operations at Churchill Downs Incorporated, announced her retirement effective December 31, 2025. The company has entered into a Memorandum of Understanding with Adams, detailing her retirement benefits, including a bonus, stock vesting, a retention payment, and the termination of a previous agreement, which may impact the company’s executive structure and operations.

The most recent analyst rating on (CHDN) stock is a Buy with a $160.00 price target. To see the full list of analyst forecasts on Churchill Downs stock, see the CHDN Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Churchill Downs Shareholders Approve Key 2025 Decisions
Neutral
Apr 22, 2025

On April 22, 2025, Churchill Downs Incorporated held its Annual Meeting of Shareholders, where several key decisions were made. Shareholders approved the 2025 Omnibus Stock and Incentive Plan, elected two Class II Directors, ratified PricewaterhouseCoopers LLP as the independent accounting firm for 2025, and approved executive compensation on an advisory basis. These decisions reflect the company’s strategic focus on aligning executive incentives with shareholder interests and ensuring robust financial oversight.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 15, 2025