MeritValue

Churchill Downs Inc

CHDNdata completeness 100%17 fiscal years on file
The thesis, from the filings

Churchill Downs Inc earns about 6% on invested capital, below its ~9% cost of capital, and has bought back 8% of its shares over 5 years — no moat visible in the numbers. The estimate methods put fair value between $60.23 and $419.77 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$1.6B1$1.81B2$2.46B3$2.73B3$2.93B3
Net income$249.1M4$439.4M5$417.3M6$426.8M6$383M6
Operating cash flow$459.5M7$510.8M8$605.3M9$771.7M9$769.8M9
Capital expenditure$39.5M10$50.2M11$77.7M12$83.6M12$70.2M12
Free cash flow (derived)$420M7$460.6M8$527.6M9$688.1M9$699.6M9
Total debt$3.94B13$9.21B14$4.84B15$4.91B16$5.13B16
Cash & equivalents$291.3M17$129.8M18$144.5M19$175.5M20$200.6M20
Diluted shares78.4M77.0M76.1M74.6M71.8M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$140.63
your share of equity
Profit it earned you last year
$53.34
Free cash flow it threw off
$97.44
Debt you’d be carrying
$714.51

10 shares is a claim on $140.63 of net worth that earned you $53.34 and generated $97.44 of cash last year, against $714.51 of debt.

iii. Is this a good business?
Moat signal · return on invested capital
6% avg · 5y
FY21 8%FY22 6%FY23 11%FY24 4%FY25 3%

It earned about 6% on invested capital against a ~9% cost of capital — below the cost of funding. The numbers show no moat.

seeing a moat in the numbers →
Management signal · capital allocation
−8% shares · 5y

Share count is down 8% over 5 years — management has been buying back stock, quietly handing owners a bigger slice. Total debt has risen 30% over the same window.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $60.23 and $419.77 a share. They rest on different assumptions, so where they diverge is the story.

DCF · Growth Exit 10Y
$419.77
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth17.9%
  • fcfBase$688.1M
DCF · Growth Exit 5Y
$219.2
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth17.9%
  • fcfBase$688.1M
Earnings Power Value
$60.23
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$417.3M
  • growthAssumed0.0%
Graham Number
not applicable
diluted EPS missing or non-positive — Graham Number undefined

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years17.9%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $219.2
The three cases
Bear0.0%$68.27
Base17.9%$219.2
Bull20.0%$243.8

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 17.9%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0000020212-24-000055 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0000020212-25-000051 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0000020212-26-000025 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0000020212-24-000055 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0000020212-25-000051 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0000020212-26-000025 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0000020212-24-000055 (NetCashProvidedByUsedInOperatingActivitiesContinuingOperations)
  8. 10-K · period ending 2022-12-31 · accession 0000020212-25-000051 (NetCashProvidedByUsedInOperatingActivitiesContinuingOperations)
  9. 10-K · period ending 2023-12-31 · accession 0000020212-26-000025 (NetCashProvidedByUsedInOperatingActivitiesContinuingOperations)
  10. 10-K · period ending 2021-12-31 · accession 0000020212-24-000055 (PaymentsForCapitalImprovements)
  11. 10-K · period ending 2022-12-31 · accession 0000020212-25-000051 (PaymentsForCapitalImprovements)
  12. 10-K · period ending 2023-12-31 · accession 0000020212-26-000025 (PaymentsForCapitalImprovements)
  13. 10-K · period ending 2021-12-31 · accession 0000020212-23-000059 (LongTermDebtNoncurrent)
  14. 10-K · period ending 2022-12-31 · accession 0000020212-24-000055 (LongTermDebtNoncurrent)
  15. 10-K · period ending 2023-12-31 · accession 0000020212-25-000051 (LongTermDebtNoncurrent)
  16. 10-K · period ending 2024-12-31 · accession 0000020212-26-000025 (LongTermDebtNoncurrent)
  17. 10-K · period ending 2021-12-31 · accession 0000020212-23-000059 (CashAndCashEquivalentsAtCarryingValue)
  18. 10-K · period ending 2022-12-31 · accession 0000020212-24-000055 (CashAndCashEquivalentsAtCarryingValue)
  19. 10-K · period ending 2023-12-31 · accession 0000020212-25-000051 (CashAndCashEquivalentsAtCarryingValue)
  20. 10-K · period ending 2024-12-31 · accession 0000020212-26-000025 (CashAndCashEquivalentsAtCarryingValue)