CHDN · Consumer discretionary(services-racing, including track operation) · 10 years of annual accounts filed with the SEC · latest fiscal year ended 2025-12-31
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Churchill Downs Inc reported revenue of $2.9 billion in fiscal 2025. Of the $3.7 billion its operations generated over 10 years, 90.2% went to acquisitions and 48.0% to buybacks. On the accounting screens, it passes 6 of 8 Piotroski tests, its Altman Z'' of 0.96 is in the distress zone and its Beneish M-score is below the -1.78 line; 2 of the six cross-checks between its statements fire.
Revenue, fiscal 20252.9B
Operating margin23.4%gross margin —
Return on invested capital8.1%7.6% on average over 5 years
Free cash flow after stock pay669.4M22.9% of revenue
Net debt ÷ EBITDA5.4×net debt 4.9B
Piotroski F-score6/8tests of improvement passed
Share counts are in today's shares. The SEC's filings restate only recent years after a split, so these jumps were read as splits and the older years scaled to match — otherwise per-share figures would compare different units:
2-for-1 before fiscal 2021.
Is it growing?
Revenue and the operating income it turns into. Growth that does not reach operating income is growth bought with margin.
RevenueOperating income
01B2B3B
2018
2018Revenue 1.0BOperating income 188.8M
2019
2019Revenue 1.3BOperating income 215.7M
2020Revenue 1.1BOperating income 60.2M
2021Revenue 1.6BOperating income 284.4M
2022Revenue 1.8BOperating income 321.8M
2023Revenue 2.5BOperating income 564.0M
2024Revenue 2.7BOperating income 709.0M
2025Revenue 2.9BOperating income 683.8M
2018201820192019202020212022202320242025
Compound growth a year
3 yrs
5 yrs
9 yrs
Revenue
+17.4%
+22.7%
—
Operating income
+28.6%
+62.6%
—
Net income
-4.5%
—
—
Earnings per share
-2.2%
—
—
Free cash flow per share
+17.7%
—
—
Dividend per share
+8.3%
+8.0%
—
Shares
-2.3%
-2.2%
—
Falling shares are buybacks: each remaining share owns more of the company.
Does it earn more than its capital costs?
Margins say how much of each sale is kept; return on invested capital says how much the business earns on the money it needs to operate. Growth only creates value when that return is above the cost of the capital.
GrossOperatingNetFree cash flow
-20%0%20%40%
2018
2018Operating 18.7%Net 35.0%Free cash flow 16.7%
2019
2019Operating 16.2%Net 10.3%Free cash flow 15.5%
2020Operating 5.7%Net -7.8%Free cash flow -6.6%
2021Operating 17.8%Net 15.6%Free cash flow 26.3%
2022Operating 17.8%Net 24.3%Free cash flow 25.5%
2023Operating 22.9%Net 17.0%Free cash flow 21.4%
2024Operating 25.9%Net 15.6%Free cash flow 25.2%
2025Operating 23.4%Net 13.1%Free cash flow 23.9%
2018201820192019202020212022202320242025
Return on invested capital
Return on invested capitalCost of capital today · 5.2%
0%5%10%15%
2018
2018Return on invested capital 10.9%
2019
2019Return on invested capital 7.7%
2020Return on invested capital 1.0%
2021Return on invested capital 9.1%
2022Return on invested capital 4.5%
2023Return on invested capital 7.3%
2024Return on invested capital 8.9%
2025Return on invested capital 8.1%
2018201820192019202020212022202320242025
Economic profit
Economic profit
-100M0100M200M300M
2018
2018Economic profit 76.9M
2019
2019Economic profit 50.3M
2020Economic profit -83.0M
2021Economic profit 88.0M
2022Economic profit -35.6M
2023Economic profit 121.3M
2024Economic profit 219.6M
2025Economic profit 176.2M
2018201820192019202020212022202320242025
(return on capital − cost of capital) × capital invested: the profit left after paying for the money used. Today's cost of capital is applied to every year, since a past one cannot be rebuilt honestly.
Return on equity
37.9%
Return on assets
5.1%
Asset turnover
0.39×
Overheads (SG&A)
8.4% of revenue
Is the profit cash, and where does the cash go?
Net income is an accounting opinion; free cash flow is what was left in the bank after investing. Stock-based pay does not leave the bank — shareholders pay it through dilution — so it is shown taken off as well.
Net incomeFree cash flowAfter stock-based pay
-200M0200M400M600M800M
2018
2018Net income 352.8MFree cash flow 168.2MAfter stock-based pay 147.1M
2019
2019Net income 137.5MFree cash flow 206.7MAfter stock-based pay 182.9M
2020Net income -81.9MFree cash flow -69.3MAfter stock-based pay -93.0M
2021Net income 249.1MFree cash flow 420.0MAfter stock-based pay 392.2M
2022Net income 439.4MFree cash flow 460.6MAfter stock-based pay 428.8M
2023Net income 417.3MFree cash flow 527.6MAfter stock-based pay 494.7M
2024Net income 426.8MFree cash flow 688.1MAfter stock-based pay 652.0M
2025Net income 383.0MFree cash flow 699.6MAfter stock-based pay 669.4M
2018201820192019202020212022202320242025
Where 10 years of operating cash went, 2018–2025
3.7B generated by the business. Each band is its share of that total.
Reinvested in the business 17%644.9M
Acquisitions 90%3.4B
Dividends 6%207.2M
Share buybacks 48%1.8B
More than it generated: funded with cash or new debt -61%-2.3B
Over the same years it paid 227.4M in stock. 1.6B of the buybacks went beyond offsetting that dilution.
Per share
Earnings per shareFree cash flow per shareDividend per share
-$5$0$5$10
2018
2018Earnings per share $4.24Free cash flow per share $2.02Dividend per share $0.28
2019
2019Earnings per share $1.69Free cash flow per share $2.55Dividend per share $0.27
2020Earnings per share $-1.02Free cash flow per share $-0.86Dividend per share $0.29
2021Earnings per share $3.18Free cash flow per share $5.36Dividend per share $0.32
2022Earnings per share $5.71Free cash flow per share $5.98Dividend per share $0.34
2023Earnings per share $5.48Free cash flow per share $6.93Dividend per share $0.36
2024Earnings per share $5.72Free cash flow per share $9.22Dividend per share $0.39
2025Earnings per share $5.33Free cash flow per share $9.74Dividend per share $0.43
2018201820192019202020212022202320242025
Shares outstanding
Diluted shares
70M75M80M85M
2018
2018Diluted shares 83.2M
2019
2019Diluted shares 81.2M
2020Diluted shares 80.2M
2021Diluted shares 78.4M
2022Diluted shares 77.0M
2023Diluted shares 76.1M
2024Diluted shares 74.6M
2025Diluted shares 71.8M
2018201820192019202020212022202320242025
Debt and liquidity
Debt is not bad in itself; debt the business cannot service in a bad year is. Net debt is debt minus cash, and below zero the company holds more cash than it owes.
Net debt
02B4B6B
2018
2018Net debt 751.0M
2019
2019Net debt 1.4B
2020Net debt 1.6B
2021Net debt 1.7B
2022Net debt 4.5B
2023Net debt 4.7B
2024Net debt 4.7B
2025Net debt 4.9B
2018201820192019202020212022202320242025
Net debt ÷ EBITDA
5.4×
Interest coverage
2× operating income ÷ interest
Current ratio
0.60 current assets ÷ current liabilities
Cash conversion cycle
— collects in 12d
Three classic screens of the accounts
Each asks a different question of the same statements — is it improving, does it look like a company heading for distress, do the accounts resemble ones that were manipulated. None is a verdict; each shows what moves it.
Piotroski F-score
Is the business improving? Nine yes-or-no tests, this year against last.
6of 8 tests passed
✓ProfitableReturn on assets above zeropassed
✓Cash from operationsOperating cash flow above zeropassed
✕Profitability improvedReturn on assets higher than a year beforefailed
✓Profit backed by cashOperating cash flow above net income (low accruals)passed
✕Less long-term debtLong-term debt as a share of assets fellfailed
✓More liquidCurrent ratio higher than a year beforepassed
✓No new sharesShare count did not growpassed
–Better gross marginGross margin higher than a year before — not reportedno data
✓Sells more per assetAsset turnover higher than a year beforepassed
Where it misleads: it measures change, not level. An excellent business that stood still for a year scores low; a poor one recovering from a disaster scores high.
Altman Z''-score
Does the balance sheet look like those of companies that went bankrupt?
0.96distress zone
1.12.6
Working capital ÷ assets -0.04 × 6.56-0.25
Retained earnings ÷ assets 0.14 × 3.26+0.44
Operating income ÷ assets 0.09 × 6.72+0.61
Equity ÷ liabilities 0.16 × 1.05+0.16
Where it misleads: buybacks. A company that returns so much cash that its equity turns small or negative sinks the last two ratios without being anywhere near bankruptcy. Banks and insurers do not fit the model at all.
Beneish M-score
Do the accounts resemble those of companies that manipulated their earnings?
-2.77below the -1.78 line
-1.78
Receivables vs sales 0.89+0.81
Gross margin slipping 1.00 (not reported, set to 1)+0.53
Soft assets 1.01+0.41
Sales growth 1.07+0.95
Slower depreciation 0.87+0.10
Overheads vs sales 0.97-0.17
Profit not in cash -0.05-0.24
Leverage rising 1.01-0.33
Where it misleads: fast growth and acquisitions. Sales growth carries a heavy weight, so a company growing 50% a year scores like a suspect without having done anything. It is a screen from a 1999 study, not an accusation.
Where the statements disagree
Cross-checks between the income statement, the balance sheet and the cash flow for the latest year, each with the benign reading and the worrying one.
Capital spending (70M) is well below depreciation (233M).
Benign
Mature assets, or a business that has become less capital-intensive.
Worrying
Under-investing: today's profit is being held up by consuming tomorrow's capacity.
Net debt is 5.4 times EBITDA.
Benign
A stable sector with predictable cash flows and comfortable maturities.
Worrying
Little room if earnings fall; the maturity schedule is what to check.
What is it worth, under which assumptions?
A company is worth the cash it will generate, brought back to today. This model projects revenue with growth that fades over the years, applies a free cash flow margin, and discounts the result at the cost of capital. Every assumption says where it came from, and all of them can be changed.
81% of the value comes from after year 10: this valuation rests mostly on the long run, which is exactly what is least known.
Value per share, with these assumptions$715.95discounted at 5.2% a year · 81% of it from after year 10
Type a share price on the left to ask the reverse questions: what growth, what margin or what discount rate that price implies.
What the value implies, in the usual multiples
At this model's value
Price ÷ earnings
134.2×
Enterprise value ÷ EBITDA
61.4×
Enterprise value ÷ revenue
19.3×
Free cash flow yield
1.3%
From cash flows to a value per share
10 years of cash flow, today10.7B
Everything after, today45.7B
The whole business56.3B
Minus net debt-4.9B
What belongs to shareholders51.4B
Divided among 71.8M shares: <strong>$715.95</strong> each.
The projection next to its history
Reported free cash flow after stock pay, then the model's. A projection that looks nothing like the past needs a reason.
ReportedProjected
-1B01B2B
2018
2018Reported 147.1M
2019
2019Reported 182.9M
2020Reported -93.0M
2021Reported 392.2M
2022Reported 428.8M
2023Reported 494.7M
2024Reported 652.0M
2025Reported 669.4M
2026Projected 763.6M
2027Projected 918.4M
2028Projected 1.1B
2029Projected 1.3B
2030Projected 1.4B
2031Projected 1.6B
2032Projected 1.7B
2033Projected 1.9B
2034Projected 1.9B
2035Projected 2.0B
2018201920202022202420262028203020322034
Year by year
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
Revenue
3.6B
4.3B
5.1B
5.9B
6.7B
7.5B
8.1B
8.7B
9.1B
9.3B
Growth
22.5%
20.3%
18.1%
15.8%
13.6%
11.4%
9.2%
6.9%
4.7%
2.5%
Cash margin
21.3%
21.3%
21.3%
21.3%
21.3%
21.3%
21.3%
21.3%
21.3%
21.3%
Free cash flow
763.6M
918.4M
1.1B
1.3B
1.4B
1.6B
1.7B
1.9B
1.9B
2.0B
Worth today
725.8M
829.9M
931.4M
1.0B
1.1B
1.2B
1.2B
1.2B
1.2B
1.2B
If the least-known inputs move
Value per share as two inputs change at a time. Neighbouring cells that differ a lot are the conclusion: the value depends on numbers nobody knows to a point.
The discount rate and growth forever
discount ↓ · forever →
1.5%
2.0%
2.5%
3.0%
3.5%
4.2%
749
925
1,205
1,720
2,982
4.7%
614
733
905
1,180
1,685
5.2%
516
600
716
884
1,152
5.7%
442
506
589
702
868
6.2%
384
433
495
576
688
Year-one growth and the final margin
margin ↓ · growth →
18.5%
20.5%
22.5%
24.5%
26.5%
17.0%
474
521
571
625
683
19.2%
535
587
643
704
769
21.3%
596
654
716
783
855
23.4%
657
720
788
861
940
25.6%
718
787
861
940
1,026
All the inputs moving at once
4,675 valuations, each with growth, final margin, discount rate and growth forever drawn at random around the values on the left (spreads of 3.0%, 3.2%, 1.0% and 0.5%). Not a probability — the spreads are assumptions too — but an honest picture of how wide the answer is.
10th percentile$405.72
Median$690.65
90th percentile$1,330.00
$500.00$1,000.00$1,500.00$2,000.00
Half of the simulations land between <b>$516.56</b> and <b>$954.85</b>; one in ten below $405.72, one in ten above $1,330.00.
Does the long run make sense?
25.9×The terminal value prices the business in year 10 at 25.9 times that year's EBITDA.
Free growthIn year 10 free cash flow is at or above after-tax operating profit, yet the model grows 2.5% forever. Growth needs reinvestment; this assumes it comes for free, which flatters the terminal value.
81%of the value comes from after year 10. The more of it, the more the answer depends on the part nobody can see.
Every Form 4 filed in the last twelve months, read line by line: 6 filings by 5 people. Open-market purchases and sales are counted apart from awards, option exercises and shares withheld for taxes.
Bought on the open market—none in the period
Sold on the open market—none in the period
Under pre-arranged plans—of the sales followed a 10b5-1 plan set months earlier
A Form 4 says what happened, when, how many shares and at what price. It does not say why: a sale can be diversification, a tax bill or a plan fixed months earlier, and an award is pay, not a purchase. Nothing here is a reason to buy or sell anything.
Which large funds report holding it
From the Form 13F of the 28 institutions followed on this site, as of the end of their last reported quarter. A 13F is filed up to 45 days later and shows only long positions in US-listed shares.
Accounts from the company's own SEC filings; lines some companies do not report are shown as a dash rather than estimated. The risk-free rate is the 10-year US Treasury yield. A DCF is a way of making assumptions explicit, not a forecast: it states what the company would be worth if the assumptions held. The scores are screens that point where to look, not verdicts. Nothing here is a recommendation to buy or sell.
