A Look At Churchill Downs (CHDN) Valuation As Derby Week Format Changes Take Shape

Churchill Downs (CHDN) has outlined significant changes for its 152nd Spring Meet and Derby Week, including a longer nine week schedule, the return of Sunday racing, and a primetime Kentucky Oaks broadcast, all with potential implications for investor interest.

See our latest analysis for Churchill Downs.

The Derby Week updates are arriving at a time when Churchill Downs’ 30 day share price return of 13.88% decline and 1 year total shareholder return of 25.91% loss suggest fading momentum despite earlier resilience. This context may influence how investors interpret event driven upside and risk.

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With Churchill Downs trading at US$90.84 and screening on some metrics as below certain value estimates, yet carrying multi year total returns in decline, you have to ask: is there genuine undervaluation here, or is the market already pricing in future growth?

Most Popular Narrative: 32.6% Undervalued

With Churchill Downs closing at $90.84 against a narrative fair value of $134.75, the current price sits well below what this widely followed storyline suggests.

Expansion and ramp-up of high-margin Historical Racing Machine (HRM) properties in Kentucky and Virginia, along with new projects in New Hampshire and potential new markets, will increase Churchill Downs' exposure to experiential gaming and drive recurring revenue and margin growth, as consumer preferences continue shifting toward destination entertainment and integrated gaming.

Read the complete narrative.

Want to see what is behind that confidence in recurring cash flows and premium racing experiences? The narrative leans heavily on steady revenue expansion, improving profitability, and a richer earnings mix over time, all filtered through a specific discount rate and future earnings multiple that many investors will want to scrutinize for themselves.

Result: Fair Value of $134.75 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, you still need to weigh concentration in racing and HRM venues, as well as ongoing heavy project spending, which could squeeze margins if customer demand disappoints.

Find out about the key risks to this Churchill Downs narrative.

Build Your Own Churchill Downs Narrative

If you look at the numbers and come to a different conclusion, or just prefer your own framework, you can build a personalized Churchill Downs thesis in minutes: Do it your way.

A great starting point for your Churchill Downs research is our analysis highlighting 4 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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