{"id":160152,"date":"2021-01-04T10:51:44","date_gmt":"2021-01-04T18:51:44","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=160152"},"modified":"2021-01-04T11:45:17","modified_gmt":"2021-01-04T19:45:17","slug":"churchill-downs-stock-got-some-love-higher-price-target-from-bofa","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/","title":{"rendered":"Churchill Downs ‘Irreplaceable Assets’ Driving EBITDA Growth, Says BofA Analyst"},"content":{"rendered":"

Churchill Downs (NASDAQ:CHDN) is setting up to be one of 2021’s more compelling names in the gaming space, according to one analyst.<\/p>\n

\"CHDN
Scenes from the 2020 Kentucky Derby. An analyst is bullish on Churchill Downs. (Image: Getty Images)<\/figcaption><\/figure>\n

In new coverage of the racetrack operator’s stock, Bank of America (BofA) analyst Finn Barrett today rates Churchill a \u201cbuy\u201d with a $235 price target. On the first trading day of the new year, CHDN stock is following most of its gaming peers and the broader market lower on concerns stemming from a spike in coronavirus cases and jitters among market participants regarding the outcomes of two Senate runoff elections in Georgia tomorrow.<\/p>\n

Those could prove to be temporary headwinds, as the BetAmerica operator is poised to deliver stellar earnings before interest, taxes, depreciation and amortization (EBITDA) growth over the next several years.<\/p>\n

We expect CHDN to grow EBITDA by +50 percent in 2022 relative to 2019, the best in the gaming industry. This may even prove conservative, with our upside case closer to +90 percent,\u201d said Barrett in note to clients.<\/p><\/blockquote>\n

His price forecast of $235, which is the highest among sell-side analysts, implies upside of 20.5 percent from the Dec. 31 close, and is well above the Wall Street consensus of $199.33. Churchill’s 52-week high is $212.60, which was set just last month.<\/strong><\/p>\n

Enviable Asset Mix<\/h2>\n

Churchill’s BetAmerica<\/a> brand trails some of the more recognizable brands in the booming US online sports betting arena. But the operator is making moves to increase market share<\/a> and is positioning itself to capitalize on iGaming growth, too.<\/p>\n

\n

Between BetAmerica, the Twin Spires horse betting app, and its eponymous racetrack in its home state of Kentucky, Churchill Downs has \u201cunique\/irreplaceable assets that provide a strong moat,\u201d notes Barrett, the BofA analyst. \u201cMoat\u201d is financial lingo to describe a company’s competitive advantages. A firm with a strong or wide moat, such as Churchill, can fend off competitors for up to two decades.<\/p>\n<\/div>\n

According to Morningstar<\/a>, moats are derived from five sources: Switching costs, the network effect, intangible assets, cost advantages, and efficient scale.<\/p>\n

\u201cIntangible assets are things such as patents, government licenses, and brand identity that keep competitors at bay,\u201d says the research firm.<\/p>\n

With online casino and sports betting licenses in multiple states, and ownership of the Kentucky Derby, Churchill Downs checks the intangible assets box<\/strong>.<\/p>\n

Decent Balance Sheet<\/h2>\n

Entering 2021, Churchill’s balance sheet is fair among regional gaming competitors. It has long-term debt of $2.16 billion and cash on hand of $622 million. It’s positive on a net operating cash flow basis, something that is not true<\/a> of some of its rivals.<\/p>\n

Most of the analysts covering CHDN stock are bullish or very bullish on the name, and the average price target on the shares increased 7.55 percent over the final two months of 2020.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Churchill Downs (NASDAQ:CHDN) is setting up to be one of 2021’s more compelling names in the gaming space, according to one analyst. In new coverage of the racetrack operator’s stock, Bank of America (BofA) analyst Finn Barrett today rates Churchill a \u201cbuy\u201d with a $235 price target. On the first trading day of the new […]<\/p>\n","protected":false},"author":46,"featured_media":160153,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[62,10],"tags":[],"acf":[],"yoast_head":"\nChurchill Downs Stock Got Some Love, Higher Price Target from BofA<\/title>\n<meta name=\"description\" content=\"Churchill Downs could be a star among gaming stocks when it comes to EBITDA growth, says Bank of America.\" \/>\n<meta name=\"robots\" content=\"noindex, follow\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Churchill Downs Stock Got Some Love, Higher Price Target from BofA\" \/>\n<meta property=\"og:description\" content=\"Churchill Downs could be a star among gaming stocks when it comes to EBITDA growth, says Bank of America.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/\" \/>\n<meta property=\"og:site_name\" content=\"Casino.org\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/Casino.OrgNews\" \/>\n<meta property=\"article:published_time\" content=\"2021-01-04T18:51:44+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2021-01-04T19:45:17+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/01\/derby-scaled.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"2560\" \/>\n\t<meta property=\"og:image:height\" content=\"1440\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Todd Shriber\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@etfgodfather\" \/>\n<meta name=\"twitter:site\" content=\"@Casino_Org\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Todd Shriber\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/\",\"url\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/\",\"name\":\"Churchill Downs Stock Got Some Love, Higher Price Target from BofA\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/01\/derby-scaled.jpg\",\"datePublished\":\"2021-01-04T18:51:44+00:00\",\"dateModified\":\"2021-01-04T19:45:17+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Churchill Downs could be a star among gaming stocks when it comes to EBITDA growth, says Bank of America.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-got-some-love-higher-price-target-from-bofa\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/01\/derby-scaled.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2021\/01\/derby-scaled.jpg\",\"width\":2560,\"height\":1440,\"caption\":\"Scenes from the 2020 Kentucky Derby. 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