Churchill Downs Incorporated Common Stock (CHDN)

FairStock Score: 49/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a value investor, I start with the business and the price. Churchill Downs operates live and historical racing, wagering services, and regional casinos, a cyclical but cash-generative gambling franchise. In fiscal 2025, the year ended 2025-12-31, revenue was $2.9B and net income $383.0M. That profit was below fiscal 2024's $426.8M, even though revenue rose from $2.7B. In fiscal Q2 2026, the quarter ended 2026-06-30, revenue was $980.0M and net income $241.0M, showing a strong seasonal quarter. FairStock's calculated Piotroski F-Score is 7/9, and trailing free cash flow is $382.6M, a 6.8% FCF yield against the $5.6B market cap. Those are marks of a real cash engine. But the balance sheet demands caution: debt-to-equity is 3.49, return on capital employed is only 6.48%, and the Altman Z-Score of 0.95 is weak. High return on equity of 33.85% looks less impressive when leverage is doing much of the work. At the 2026-10-13 close of $81.06, FairStock's P/E is 13.76 and EV/EBITDA is 9.17, not demanding on current earnings. Yet the Graham Number is $50.50, leaving a negative 60.51% margin of safety, and P/B is 4.23. The computed Lynch category is STALWART, citing steady growth: profit 11.4% a year over four years and revenue 16.3%. The tension is clear: a decent operating business with high leverage and a price that already reflects much of the good news. I would watch debt reduction, cash flow durability, and whether fiscal 2026 earnings recover.

In plain English: Churchill Downs runs horse racing tracks, betting services, and casinos. The business makes money and has grown revenue, but it carries a lot of debt and profit fell in fiscal 2025. At the recent price of $81.06, the stock looks more expensive than simple value measures suggest, though its earnings-based price is not extremely high.

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Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer