Churchill Downs Incorporated: 2Q26 Takes; Quarter Was Fine, but Investor Patience in Short Supply as CHDN Optimizes Portfolio Via Regional Sale; Stay OW, PT $123 (-$3)

Research evidence excerpt

Churchill Downs Incorporated: 2Q26 Takes; Quarter Was Fine, but Investor Patience in Short Supply as CHDN Optimizes Portfolio Via Regional Sale; Stay OW, PT $123 (-$3)

J P M O R G A N North America Equity Research

30 July 2026

Churchill Downs Incorporated

2Q26 Takes; Quarter Was Fine, but Investor Patience in Overweight

Short Supply as CHDN Optimizes Portfolio Via CHDN, CHDN US

Regional Sale; Stay OW, PT $123 (-$3) Price (29 Jul 26):$88.53

▼Price Target (Dec-27):$123.00

Prior (Dec-27):$126.00

CHDN materially underperformed today, -9% vs. SPX +1.4%, despite an ~in-line

2Q report, and formal commentary that the company is exploring options to sell the Gaming & Lodging

majority of its wholly-owned regional gaming portfolio. To us, today’s selloff Daniel Politzer, CFA AC

seems like an overreaction, and could relate to CHDN’s call commentary that its (1-212) 622-0110

sale of regional properties could be piecemeal or in small groups. So why announce daniel.politzer@jpmorgan.com

it at all? With the 8-K, CHDN should have more flexibility to repurchase stock and Samuel Nielsen

address its ‘27 debt maturities. While bears may be interpreting this as a failure to (1-212) 622-1366

samuel.nielsen@jpmchase.com

execute, the company believes sales of single/small groups of properties will

Michael Hirsh, CFA

maximize proceeds, with faster deal closings/quicker return of capital. Following

(1-212) 622-0295

a slightly lower than forecast Derby EBITDA result (which sent the stock -7% on michael.hirsh@jpmchase.com

May 4th), we believe investors are frustrated with CHDN’s execution; FY26 J.P. Morgan Securities LLC

EBITDA est’s have changed by less than 1% YTD, but the stock is -29% YTD. At

7.8x FY27 EV/EBITDA (6x ex-Derby), valuation remains undemanding, and our