{"id":322043,"date":"2024-06-08T17:09:52","date_gmt":"2024-06-08T22:09:52","guid":{"rendered":"https:\/\/www.casino.org\/news\/?p=322043"},"modified":"2024-06-08T17:09:52","modified_gmt":"2024-06-08T22:09:52","slug":"churchill-downs-stock-has-tailwinds-says-analyst","status":"publish","type":"post","link":"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/","title":{"rendered":"Churchill Downs Stock Has Tailwinds, Says Analyst"},"content":{"rendered":"

Churchill Downs (NASDAQ: CHDN) stock is off a third of a percent year-to-date, which is actually good for one of the better performances among gaming equities. At least one analyst believes the shares could shake that lethargy.<\/p>\n

\"Churchill
Churchill Downs’ Derby City Gaming Downtown historical horse racing venue in Louisville. Despite that venue’s slow start, an analyst is bullish on the stock.(Image: The Courier-Journal<\/em>)<\/figcaption><\/figure>\n

In a recent note to clients, Stifel analyst Jeffrey Stantial proclaimed Churchill Downs to be a catalyst-rich story with deleveraging among those sparks. He reiterated a \u201cbuy\u201d rating on the shares with a $153 price target, which implies upside of 13.7% from the June 7 close. The operator is coming off a record-setting handle for the Kentucky Derby and Derby Week<\/a> last month, which should provide ballast to second-quarter results.<\/p>\n

Management highlighted the simultaneously announced extended broadcast rights agreement with NBC Sports, while growth in viewership (+13% Y\/Y) and development projects help support CHDN’s targeted sponsorship strategy<\/a>,\u201d observed Stantial. Guest feedback on the debuted ~$200 million Paddock project has been overwhelming positive, while management reiterated it has an opportunity to optimize and yield up the space in 2025+.\u201d<\/p><\/blockquote>\n

Churchill\u2019s TwinSpires unit was a Derby beneficiary as the online betting entity garnered a handle of $92.1 on \u201cthe run for the roses,\u201d easily besting the prior record of $75.5 million set last year.<\/p>\n

Kentucky, Virginia Central to Churchill Downs Stock Thesis<\/h2>\n

While data indicate that Churchill\u2019s newest historical horse racing (HHR) facility — the $90 million<\/a> Derby City Gaming venue in the operator\u2019s home city of Louisville \u2013 is off to a slow start, Kentucky and Virginia remain pivotal to the stock\u2019s broader thesis.<\/p>\n

\n

The operator\u2019s historical racing machine (HRM) venues in Virginia are growing. Those properties operate under the Rosies brand and all except one recently notched double-digit gross gaming revenue (GGR) on a year-over-year basis. Virginia\u2019s ban on skill games is a positive for Churchill in the state.<\/p>\n<\/div>\n

\u201cWe note the Virginia governor recently vetoed a bill re-legalizing skill games, though expressing openness to negotiation with legislators – with higher tax rate and geographic exclusion zones around casino\/HHR facilities likely the key sticking points,\u201d added Stantial. \u201cThe potential casino project in Petersburg also remains a key focus for investors, with notable public opposition from unions and competitors.\u201d<\/p>\n

Even with the slow start by Derby City, Churchill management signaled to Stantial that overall same-store sales trends at its Kentucky gaming venues remain sturdy.<\/strong><\/p>\n

Exacta Deal Paying Dividends<\/h2>\n

Churchill shares could also benefit from the operator\u2019s savvy deal-making, including the December 2022 $250 million deal<\/a> for Exacta Systems, a Florida-based provider of HHR systems and gaming machines.<\/p>\n

Exacta bolstered Churchill\u2019s HHR exposure in its home state and Virginia as well as New Hampshire, which has been accretive to growth in its own right.<\/p>\n

\u201cManagement reiterated plans to convert ~10% of KY floors to Exacta, while our back-of-envelope analysis suggests $15M+ of incremental annualized cost savings in VA alone reflecting healthy same-store growth and the addition of ‘The Rose’ (but before deployment of remaining HRM capacity),\u201d concluded Stantial. \u201cWhile still early, management sees opportunity to participate in international HHR growth as well as through Exacta.\u201d<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Churchill Downs (NASDAQ: CHDN) stock is off a third of a percent year-to-date, which is actually good for one of the better performances among gaming equities. At least one analyst believes the shares could shake that lethargy. In a recent note to clients, Stifel analyst Jeffrey Stantial proclaimed Churchill Downs to be a catalyst-rich story […]<\/p>\n","protected":false},"author":46,"featured_media":320931,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10,14577,86438,86436,1074],"tags":[81903,81900,86457,86509,80968],"acf":[],"yoast_head":"\nChurchill Downs Stock Has Tailwinds, Says Analyst<\/title>\n<meta name=\"description\" content=\"Churchill Downs Stock Has Tailwinds, Says Analyst.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Churchill Downs Stock Has Tailwinds, Says Analyst\" \/>\n<meta property=\"og:description\" content=\"Churchill Downs Stock Has Tailwinds, Says Analyst.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/\" \/>\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=\"2024-06-08T22:09:52+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2024\/05\/71806658007-gaming-01-sam.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"800\" \/>\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=\"3 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-has-tailwinds-says-analyst\/\",\"url\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/\",\"name\":\"Churchill Downs Stock Has Tailwinds, Says Analyst\",\"isPartOf\":{\"@id\":\"https:\/\/www.casino.org\/news\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2024\/05\/71806658007-gaming-01-sam.jpg\",\"datePublished\":\"2024-06-08T22:09:52+00:00\",\"dateModified\":\"2024-06-08T22:09:52+00:00\",\"author\":{\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\"},\"description\":\"Churchill Downs Stock Has Tailwinds, Says Analyst.\",\"breadcrumb\":{\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/#primaryimage\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2024\/05\/71806658007-gaming-01-sam.jpg\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2024\/05\/71806658007-gaming-01-sam.jpg\",\"width\":1200,\"height\":800,\"caption\":\"Churchill Downs' Derby City Gaming Downtown historical horse racing venue in Louisville. Despite that venue's slow start, an analyst is bullish on the stock.(Image: The Courier-Journal)\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.casino.org\/news\/churchill-downs-stock-has-tailwinds-says-analyst\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"News\",\"item\":\"https:\/\/www.casino.org\/news\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Financial\",\"item\":\"https:\/\/www.casino.org\/news\/financial\/\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"Churchill Downs Stock Has Tailwinds, Says Analyst\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.casino.org\/news\/#website\",\"url\":\"https:\/\/www.casino.org\/news\/\",\"name\":\"Casino.org\",\"description\":\"Latest Casino and Gaming News\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.casino.org\/news\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/f4cecf70a5032bc4e60eb73fc86d4a85\",\"name\":\"Todd Shriber\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.casino.org\/news\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/cropped-11-96x96.png\",\"contentUrl\":\"https:\/\/www.casino.org\/news\/wp-content\/uploads\/2023\/03\/cropped-11-96x96.png\",\"caption\":\"Todd Shriber\"},\"description\":\"Todd Shriber is a senior news reporter covering gaming financials, casino business, stocks, and mergers and acquisitions for Casino.org. 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