Churchill Downs, Inc.

Churchill Downs, Inc. (CHDN - Snapshot Report) is charging like Secretariat, recently hitting a new multi-year high after jumping more than 38% since October. With another good quarter in hand and a bullish growth projection, this Zacks #1 Rank stock is burning up the track.

Company Description

Churchill Downs, Inc. is best known for its horse-racing facilities, but the company also operates electronic gaming systems and owns a casino and a hotel. Churchill Downs was founded in 1928 and has a market cap of $872 million.

Churchill Down began trending higher in early October with the market. But shares got an extra boost in early December after the company reported strong Q3 results that came in ahead of expectations.

Third-Quarter Results

Revenue for the period was up 13% from last year to $166 million. Earnings also came in strong at $1.16, 274% ahead of the Zacks Consensus Estimate.

The revenue gain was driven by Churchill acquisition of Harlow's Casino and Hotel, contributing $13 million to the top line. Churchill is seeing better results in its online operation, with Twinspires.com seeing a 4.2% wager increase from last year while total wagering on US Thoroughbred races fell 7.4%.

Financial Profile

The company took on a little debt to get the Harlow's deal done, pushing total debt up $32 million to $167 million while cash and short-term investments held steady at $77 million.

Estimates

We've seen some decent movement in estimates over the last few months, with the current year adding 9 cents to $2.49 while the next-year estimate tacked on 4 cents to $2.83, a bullish 14% growth projection.

Valuation

With a PEG ratio of 1.43, CHDN trades at a premium to the benchmark of 1 for value.

12-Month Chart

On the chart, shares have been rallying for the last three months, recently hitting a new multi-year high on the good quarter. Take a look below.

Michael Vodicka is the Momentum Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Whisper Trader Service.

Read the full analyst report on CHDN