Churchill Downs Target of Unusually High Options Trading (NASDAQ:CHDN)

Key Points

• Investors placed an unusually high number of put options on Churchill Downs—7,643 puts traded on Thursday, about a 640% increase versus the average volume—indicating elevated bearish bets.
• Churchill Downs recently beat quarterly expectations with $1.21 EPS versus $1.06 expected and revenue of $663 million (up 3.1% year-over-year), supporting solid profitability metrics including a 43.5% return on equity.
• Analysts are broadly bullish (11 Buy vs. 1 Sell) with an average target of $139, while the stock trades around $90.47—below its 200-day moving average—and is heavily institutionally owned (about 82.6%).

Churchill Downs, Incorporated (NASDAQ:CHDN - Get Free Report) was the target of some unusual options trading activity on Thursday. Investors acquired 7,643 put options on the stock. This is an increase of approximately 640% compared to the average volume of 1,033 put options.

Churchill Downs Stock Performance

Shares of NASDAQ:CHDN traded down $1.78 during mid-day trading on Thursday, reaching $90.47. The company had a trading volume of 135,219 shares, compared to its average volume of 964,484. The company has a current ratio of 0.54, a quick ratio of 0.54 and a debt-to-equity ratio of 4.44. The firm has a market cap of $6.31 billion, a price-to-earnings ratio of 16.73, a PEG ratio of 0.61 and a beta of 0.73. The company's 50-day moving average price is $90.29 and its 200-day moving average price is $99.27. Churchill Downs has a one year low of $80.24 and a one year high of $118.46.

Churchill Downs (NASDAQ:CHDN - Get Free Report) last posted its quarterly earnings results on Wednesday, April 22nd. The company reported $1.21 EPS for the quarter, topping analysts' consensus estimates of $1.06 by $0.15. Churchill Downs had a net margin of 13.21% and a return on equity of 43.50%. The company had revenue of $663.00 million for the quarter, compared to analysts' expectations of $659.32 million. During the same quarter in the previous year, the firm posted $1.07 EPS. Churchill Downs's revenue was up 3.1% on a year-over-year basis. As a group, equities research analysts anticipate that Churchill Downs will post 7.32 EPS for the current fiscal year.

Analyst Ratings Changes

CHDN has been the topic of several recent analyst reports. Jefferies Financial Group restated a "buy" rating on shares of Churchill Downs in a research note on Tuesday, April 21st. Wells Fargo & Company restated an "overweight" rating and set a $130.00 price objective (up from $124.00) on shares of Churchill Downs in a research note on Thursday, April 16th. Citigroup restated an "outperform" rating on shares of Churchill Downs in a research note on Friday, April 24th. Mizuho raised their price objective on Churchill Downs from $146.00 to $155.00 and gave the company an "outperform" rating in a research note on Friday, April 24th. Finally, Citizens Jmp raised their price objective on Churchill Downs from $146.00 to $149.00 and gave the company a "market outperform" rating in a research note on Friday, April 24th. Eleven analysts have rated the stock with a Buy rating and one has assigned a Sell rating to the company. Based on data from MarketBeat.com, the company has an average rating of "Moderate Buy" and an average target price of $139.00.

Institutional Investors Weigh In On Churchill Downs

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Aurora Investment Counsel raised its stake in Churchill Downs by 1.2% in the 1st quarter. Aurora Investment Counsel now owns 25,924 shares of the company's stock valued at $2,329,000 after acquiring an additional 306 shares during the period. California Public Employees Retirement System raised its holdings in Churchill Downs by 12.7% during the 1st quarter. California Public Employees Retirement System now owns 134,335 shares of the company's stock valued at $12,067,000 after acquiring an additional 15,141 shares during the period. Copeland Capital Management LLC raised its holdings in Churchill Downs by 9.9% during the 1st quarter. Copeland Capital Management LLC now owns 265,569 shares of the company's stock valued at $23,856,000 after acquiring an additional 23,996 shares during the period. Bessemer Group Inc. raised its holdings in Churchill Downs by 38.2% during the 1st quarter. Bessemer Group Inc. now owns 46,141 shares of the company's stock valued at $4,145,000 after acquiring an additional 12,744 shares during the period. Finally, Twin Capital Management Inc. bought a new stake in Churchill Downs during the 1st quarter valued at $1,027,000. 82.59% of the stock is currently owned by institutional investors.

Churchill Downs Company Profile

Churchill Downs Incorporated is a leading American entertainment and gaming company best known for operating the Churchill Downs racetrack in Louisville, Kentucky, home of the annual Kentucky Derby. Beyond its signature thoroughbred racing venue, the company manages a diversified portfolio of live racing facilities, casinos, and off-track betting operations. Its services encompass pari-mutuel wagering, historical horse racing machines, and online betting through its TwinSpires platform, reaching horse racing and sports betting enthusiasts nationwide.

In its live racing segment, Churchill Downs oversees a network of racetracks and racing festivals, offering year-round events in multiple states.

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