Churchill Downs started 2026 on a strong note, with management attributing the solid first quarter to execution across both its historical racing machine (HRM) venues and core racing properties. CEO William C. Carstanjen credited growth to the successful opening of Marshall Yards in Kentucky and the continued momentum of Virginia operations. He highlighted that these investments have not only boosted attendance and generated additional purse funding for the horse racing industry, but also contributed to job creation and a stronger local economy. Management pointed to encouraging performance at new and existing venues, noting that customer engagement and spend per visit increased, especially at The Rose property in Virginia.

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While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions From Churchill Downs’s Q1 Earnings Call

• Barry Jonas (Truist): Asked for details on the Preakness IP fee structure. CEO William C. Carstanjen explained it’s a two-part arrangement: a base fee and a percentage of race handle, with opportunities for further development dependent on state collaboration.
• Daniel Politzer (JPMorgan): Inquired how the Preakness acquisition fits Churchill Downs’ capital allocation strategy. Carstanjen answered that the asset aligns with their focus on unique, iconic events and offers potential for operational improvement over time.
• Daniel Guglielmo (Capital One Securities): Asked about measuring success in growing the Kentucky Derby’s international customer base. Carstanjen said success is measured by international attendance, sponsorship activity, and viewership, with a focus on high-end customer participation.
• Chad Beynon (Macquarie): Sought insights into Virginia’s legislative environment. Carstanjen described the process as dynamic but stable, emphasizing Churchill Downs’ engagement and adaptability in the state.
• Jeffrey Stantial (Stifel): Requested color on the performance and customer impact of new electronic table games. Carstanjen reported strong initial customer uptake and incremental growth in gaming revenue from the new offerings.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will be monitoring (1) the integration and commercialization of the Preakness and Black-Eyed Susan Stakes, (2) progress on the rollout and adoption of HRM-based electronic table games in Kentucky and Virginia, and (3) legislative developments affecting gaming competition and digital expansion in core states. Additionally, the pace of international engagement with the Kentucky Derby and updates on the Rockingham Grand Casino project will be important indicators of strategic execution.

Churchill Downs currently trades at $101.15, up from $88.94 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).

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