Churchill Downs Earnings Report: What Investors Should Know

Churchill Downs (CHDN) is set to report earnings on Wednesday after the bell. Analysts expect a 3.5% YoY revenue growth to $921.6 million and adjusted EPS of $3.00. Despite positive sentiment in the consumer discretionary sector, investors should be cautious given Churchill Downs' history of missing revenue estimates and the company's 5 downward revisions over the last 30 days.

Churchill Downs (CHDN), a leading racing, gaming, and entertainment company, is set to report its earnings on Wednesday after the bell. Analysts are expecting the company to report a 3.5% year-over-year (YoY) revenue growth to $921.6 million, with adjusted earnings per share (EPS) of $3.00.

Despite the positive sentiment in the consumer discretionary sector, investors should approach Churchill Downs' earnings report with caution. The company has a history of missing revenue estimates, having done so three times over the past two years. Additionally, there have been five downward revisions to revenue estimates over the last 30 days, with analysts covering the company growing increasingly bearish.

While the overall consumer discretionary sector has seen share prices rise by an average of 11.3% over the last month, Churchill Downs has seen a 5.5% increase during the same period. The company is heading into earnings with an average analyst price target of $132.68, compared to its current share price of $105.36.

Looking at Churchill Downs' peers, some have already reported their Q2 results, offering a glimpse into what to expect. Levi's delivered year-on-year revenue growth of 6.4%, beating analysts' expectations by 5.8%, and Nike reported a revenue decline of 12%, topping estimates by 3.4%. Levi's and Nike shares traded up 11.1% and 15.2% respectively following their results.

Analysts forecast key metrics for Churchill Downs, including 'Revenue- Gaming' at $268.73 million, a -2% change from the prior-year quarter, and 'Revenue- Live and Historical Racing' at $497.22 million, a +7% change from the prior-year quarter. 'Adjusted EBITDA- Gaming' is expected to reach $124.96 million, a significant decrease from the year-ago figure of $140.70 million. 'Adjusted EBITDA- Live and Historical Racing' is forecasted at $287.57 million, a slight decrease from the same quarter last year.

Investors should closely monitor Churchill Downs' earnings report and the subsequent analyst reactions to gauge the stock's potential performance. The company's Zacks Rank is currently #3 (Hold), suggesting it is likely to perform in line with the overall market in the upcoming period.

References:
[1] https://ca.finance.yahoo.com/news/churchill-downs-chdn-reports-earnings-030350517.html
[2] https://www.nasdaq.com/articles/insights-churchill-downs-chdn-q2-wall-street-projections-key-metrics
[3] https://finance.yahoo.com/news/insights-churchill-downs-chdn-q2-131507642.html
[4] https://finance.yahoo.com/news/churchill-downs-chdn-reports-earnings-030350517.html