Powell speech takes center stage in Tuesday’s economic events
Investing.com - Churchill Downs (NASDAQ:CHDN), the $6.39 billion gaming company currently trading near its 52-week low, received a reiterated Buy rating from Stifel analyst Jeffrey Stantial following positive developments across its gaming facilities. According to InvestingPro data, the company has demonstrated solid performance with $429.9 million in net income over the last twelve months.
The company’s new $30-35 million Henrico County, Virginia, historical racing machine (HRM) facility opened on September 29, generating encouraging player feedback. Management noted that initial win per unit per day metrics will benefit from high local household income and the relatively low HRM unit count of 175 machines.
The $30-35 million Richmond expansion, which opened on August 6, has performed in line with expectations. Churchill Downs plans to deploy the full 1,200 units by year-end 2025, with underwriting assumptions accounting for some moderation in win metrics as machine counts increase.
Management expressed confidence that the upcoming $1.4 billion Petersburg development, located approximately 30-45 minutes away with a temporary facility opening by year-end 2025 and full completion in 2027, will have manageable impact on Richmond and Henrico operations. These existing facilities benefit from proximity to higher-density populations and a more "local" player experience.
The company also highlighted strong same-store gross gaming revenue growth in Kentucky, which increased 14% year-over-year in August according to Kentucky Horse Racing Commission data. Turfway and Oak Grove properties are benefiting from a new general manager who started in early 2025 and general ramp runway, respectively.
In other recent news, Churchill Downs Incorporated reported its second-quarter earnings for 2025, exceeding market expectations. The company achieved an earnings per share (EPS) of $2.99, surpassing the forecasted $2.96, and reported revenue of $934.4 million, which was higher than the anticipated $919.53 million. These results marked a positive surprise for investors. In a separate development, S&P Global Ratings downgraded Churchill Downs’ credit rating to ’BB-’ from ’BB’, citing slower-than-expected debt reduction. The agency projects the company’s debt leverage to remain above 4x through next year, which exceeds the company’s target. On the analyst front, Truist Securities reiterated its Buy rating with a $145.00 price target, maintaining a positive outlook despite the stock’s underperformance this year. Similarly, JMP Securities reiterated its Market Outperform rating with a $142.00 price target, noting that the company is trading below its long-term average valuation. These recent developments provide a mixed but detailed picture of the company’s current standing.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.