Churchill Downs (CHDN) | News Based Sentiment Analysis

• On September 3, 2025, Churchill Downs Incorporated (CDI) provided an investor presentation detailing its business segments – Live and Historical Racing, Wagering Services and Solutions, and Gaming – showcasing approximately 5,130 Historical Racing Machines in Kentucky and 4,500 in Virginia, alongside 12 gaming properties with roughly 14,360 slot machines/video lottery terminals and 360 table games. This gives investors a clearer view of CDI’s diversified operations.
• Churchill Downs reported a Q2 2025 earnings beat on September 13, 2025, with earnings of $3.10 per share, exceeding analyst estimates by $0.07, and revenue reaching $934.4 million, a 4.9% year-over-year increase. This positive financial performance demonstrates the company’s ability to generate growth.
• Despite the strong Q2 results, management lowered its projected property adjusted EBITDA for both 2025 and 2026 on September 3, 2025, revising the 2025 forecast from $65 million to $40 million and the 2026 forecast from $70 million to $60 million. This adjustment reflects ongoing cost challenges and weaker-than-expected performance.
• The 151st Kentucky Derby achieved record all-sources handle, with viewership up 6% and peak viewership up 8% compared to the prior year, and social media impressions surging 67% to over 285 million as of August 20, 2025. The company anticipates a $10 million adjusted EBITDA boost in 2026 due to a new 7-year NBC contract.
• Insider buying activity signaled bullish sentiment, with insiders collectively acquiring US$1.30 million worth of stock, including a US$928k purchase by Independent Director Douglas Grissom on September 5, 2025, at approximately US$92.77 per share. This demonstrates confidence in the company’s future prospects from those with inside knowledge.
• The Royal Bank of Canada increased its stake in Churchill Downs by 9.2% on September 13, 2025, bringing its total ownership to approximately 0.16% valued at $12.54 million. This institutional investment further supports the company’s outlook.
• On July 23, 2025, Churchill Downs approved a new $500 million share repurchase program, replacing a previous $500 million authorization, allowing for flexibility in repurchasing shares. Additionally, in Q2 2025, the company repurchased over $250 million of its stock.

The Investment Story: September presented a mixed bag for Churchill Downs, with strong Q2 earnings and positive Derby viewership offset by lowered EBITDA forecasts and recognition as a Q2 detractor in one fund’s commentary. The company is actively returning capital to shareholders through buybacks while navigating cost challenges.

What It Means for Investors: The combination of positive financial results, strategic investments in the Derby, and share repurchases is encouraging, but investors should carefully consider the reduced EBITDA guidance and recent underperformance. Monitoring the integration of recent acquisitions and the impact of cost controls will be crucial.

Looking Ahead: Investors should focus on the Q3 2025 earnings report expected around October 22, 2025, with a Zacks Consensus Estimate of $1.00 per share, representing a 3.09% year-over-year increase. Further updates on the Rosenewbuild project and the impact of the NBC contract will also be key.

The Bottom Line: Churchill Downs remains a complex investment. While the company demonstrates growth potential and a commitment to shareholder returns, the lowered guidance and ongoing cost challenges require a cautious yet attentive approach. The upcoming earnings report will be a critical indicator of the company’s trajectory.