The Bull Case For Churchill Downs (CHDN) Could Change Following HISA Fee Dispute And Betting Threat

• Churchill Downs recently faced enforcement action from the Horseracing Integrity and Safety Authority over US$2,400,000 in unpaid fees for safety inspections and drug testing services, after more than a year of discussions and ongoing federal court challenges.
• The dispute raises the prospect that HISA could halt out-of-state betting at Churchill Downs and three affiliated tracks, introducing fresh operational and regulatory uncertainty for a business that remains heavily tied to horse racing.
• We’ll now examine how the threatened halt to out-of-state betting may affect Churchill Downs’ investment narrative and longer-term risk profile.

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Churchill Downs Investment Narrative Recap

To own Churchill Downs, you need to believe its mix of horse racing, HRM venues and gaming can justify ongoing capital spending despite recent share price underperformance and softer near term earnings. The HISA enforcement action adds a new regulatory complication, but unless out of state betting is actually halted, it does not yet alter the core investment case or the immediate focus on stabilizing racing related revenue and managing legal and compliance risks.

The upcoming Q4 2025 earnings release on February 25, 2026 now matters even more, as investors will look for management’s commentary on the HISA dispute alongside updates on new projects like Marshall Yards and Rockingham Grand Casino. How convincingly Churchill Downs addresses regulatory, legal and expansion related risks on that call could shape sentiment around its ability to balance growth investments with rising compliance costs.

But one issue investors should be aware of is the growing regulatory and legal pressure around Churchill Downs’ core racing operations, which could...

Read the full narrative on Churchill Downs (it's free!)

Churchill Downs’ narrative projects $3.2 billion revenue and $541.1 million earnings by 2028. This requires 4.2% yearly revenue growth and about a $111 million earnings increase from $429.9 million today.

Uncover how Churchill Downs' forecasts yield a $134.75 fair value, a 49% upside to its current price.

Exploring Other Perspectives

Four fair value estimates from the Simply Wall St Community span a wide range, from US$52.87 to US$165.14 per share, showing how far apart opinions can be. You should weigh these views against the fresh regulatory overhang from HISA that now sits alongside existing concerns about concentrated exposure to horse racing and HRM venues, and consider how different scenarios could affect Churchill Downs’ longer term performance.

Explore 4 other fair value estimates on Churchill Downs - why the stock might be worth 42% less than the current price!

Decide For Yourself

Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so go with your instincts.

• 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.
• Our free Churchill Downs research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Churchill Downs' overall financial health at a glance.

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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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