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    Can Churchill Downs (CHDN) Stay Cheap After Its New $500 Million Loan?

    Simply Wall St·09/23/2026 12:37:34
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    Churchill Downs Incorporated has seen its share price slide in recent years, and the question now is how well that drop lines up with the cash the business is expected to generate. With the stock recently closing at US$79.49, investors are increasingly focused on what the company’s cash flows say about that tag.

    • Over the past 5 years, Churchill Downs has delivered a share price return that declined 33.0%. This puts the spotlight firmly on whether the current market value still reflects its cash generation potential.
    • The company has priced a US$500 million senior secured Term Loan B that may reshape its debt schedule. This can influence both future interest costs and how much cash is left over for other uses.
    • What if you looked at Churchill Downs through its earnings instead? See what Churchill Downs's 13.4x P/E says about the price.

    The stock's next move may depend on whether Churchill Downs' current price can be justified by the intrinsic value indicated by its projected cash flows.

    You can test the same cash flow question that hangs over Churchill Downs across a wider field of 29 high quality undervalued stocks.

    Is Churchill Downs Still Cheap on Cash Flow?

    The Discounted Cash Flow (DCF) model here is built around Churchill Downs turning its current cash generation into future equity value. The latest twelve month free cash flow sits at about $184.9 million, and the forecast path assumes rising cash available to shareholders over time rather than a shrinking pool.

    Analysts feed in free cash flow estimates that reach the mid hundreds of millions of dollars later this decade, with a second stage that tapers to more modest expansion as Churchill Downs matures. Because this DCF outcome sits substantially above the current US$79.49 share price, the market is treating those projected cash flows cautiously. The newly priced US$500 million Term Loan B due 2033 may help explain some of that discount, since a heavier debt load can make investors demand more of a cushion between trading price and what the cash flows imply. Find out what Churchill Downs could be worth using our Discounted Cash Flow (DCF) estimate.

    The Churchill Downs Narrative: What Would Justify Today's Price?

    Simply Wall St Narratives pick up where Churchill Downs' DCF puzzle leaves off by spelling out which paths for growth, profitability and earnings would need to play out for the equity to be worth materially more or less than today’s share price, and they live on the platform’s Community page. Instead of a single headline figure from a ratio or model, these narratives describe the future that number assumes so you can watch in real time whether Churchill Downs' actual progress keeps lining up with it.

    One of the top community narratives on Churchill Downs: 39% undervalued

    "Analysts expect Churchill Downs to reshape its business around higher return racing, HRM, and digital wagering assets as it reviews the sale of nine regional casinos..."

    Discover why this Narrative puts Churchill Downs at 39% undervalued.

    Churchill Downs' price is only one piece of the decision

    Churchill Downs' valuation story sits alongside a separate set of risk checks that flag potential pressure points for shareholders, and those signals deserve a closer look before you commit fresh capital. Take a closer look at 1 major warning sign before settling on a valuation.

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.