Churchill Downs Inc.

Churchill Downs Inc. (CHDN - Analyst Report)) remains sensitive to the economy but just beat Wall Street estimates with year-over-year growth.

Company Description

Churchhill Downs is one of the most famous racing companies, well known for the Kentucky Derby. Income is drawn through wagering on the races as well as services offered through other business entities.

And They're Off!

Earings per share were up year-over-year when the company reported its second-quarter results on Jul 29. The 5% increase in net earnings to almost $31 million yeilded EPS of $2.20 up from $2.10. Management sites the 35% growth in its online business for the increase in earnings.

The report was the first earnings surprise for Churchill Downs in the past 5 quarters.

President and Chief Executive Officer Robert L. Evans said, "Despite a tough economy, our Company's investments in slot-machine gaming and online businesses have helped Churchill Downs Incorporated grow second-quarter net revenues and net earnings from continuing operations year-over-year while also mitigating the continued declines in our Racing Operations."

Earnings Momentum

For the past 3 months analsyts have been raising forecasts for both this year and the next. The Zacks consensus estimate for 2009 is now $1.91, up from $1.55. Each of the 4 analysts polled by Zacks has raised their projections.

Estiamtes for next year are averaging $2.04, which is also up from $1.55 in the same time frame. Despite the excellent earnings momentum growth for the next 2 years is expected to be down slightly, off 9% this year and up 7% in the next.

The Chart

Over the past 9 months shares of CHDN have had trouble breaking through the $41 mark. However, givent the solid momentum and strong quarterly report this may be the time. Take a look at the chart below.

Email	Print	Share	RSS	Rate Pos	Rate Neg	Comment