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MEDIA 2018 02:10 PM EDT
Disseminated 27 Apr 2018 03:26 PM EDT
North America Equity Research
27 April 2018
Neutral
Churchill Downs CHDN, CHDN US
Price: $274.00 (intraday - 02:30 PM)
1Q18 Takeaways; Casinos Segment Impressive; ▲ Price Target: $280.00
Remain Neutral on Valuation; PT to $280 Previous: $270.00
CHDN posted better than expected 1Q results, primarily reflecting upside in the Gaming & Lodging
company’s Casinos segment. Total adjusted EBITDA of $49.2m topped our $44.5m AC
Daniel Politzer, CFA
and consensus’s $45.0m, as Casinos EBITDA of $44.3m came in $7.1m above our (1-212) 622-8170
estimate. We come away impressed with the 480 bps y/y improvement in wholly dan.politzer@jpmorgan.com
owned Casinos margin, which we believe was driven by the company’s more efficient Joseph Greff
marketing/promotions (a similar theme among industry peers) and a cost structure that (1-212) 622-0548
was flexed down during slower/weather impacted periods. Management also noted joseph.greff@jpmorgan.com
that higher end customers have been making more frequent trips to their properties, Brandt Montour, CFA
and that all but one of the company’s casinos increased market share and adj. EBITDA (1-212) 622-1111
brandt.a.montour@jpmorgan.com
y/y in the 1Q. Elsewhere, TwinSpires revenue growth remained strong at +22% y/y,
Omer N Sander
with one-third coming from organic growth, two-thirds from the BetAmerica
(1-212) 622-2684
acquisition which will anniversary this April. With Big Fish in the rear view, CHDN’s omer.n.sander@jpmorgan.com
1Q showcased the company’s strong execution in its existing businesses, while the J.P. Morgan Securities LLC
strong balance sheet provides dry powder for the company to evaluate “M&A
opportunities that fit [its] profile,”. We remain Neutral here on valuation as CHDN Price Performance
trades at the high end of our coverage universe (13.7x 2018E EBITDA and 5.5% 260
discretionary FCF yield), and raise our price target to $280 (+$10) primarily on higher 220
$
estimated Casino EBITDA/margin.
180
Free Cash Flow. We model discretionary FCF of $208m for 2018E and $221m for 140
2019E. Given CHDN’s strong balance sheet (net leverage of ~2.3x) and free cash Feb-17 May-17 Aug-17 Nov-17 Feb-18
1Q Recap. EBITDA of $49.2m came in better than our $44.5m on higher Casinos
EBITDA, which topped our estimate by $7m. Revenue of $189 similarly topped our
$179m, reflecting higher Casino revenues. Total Casinos revenues were $98.1m
(+12% y/y), driven by growth at Oxford (new hotel), Calder (competitor remains
closed), and Riverwalk (up an impressive 25% y/y). Wholly owned performance was
impressive, with revenue increasing $10.6m year-over-year, or 12%, and wholly
owned EBITDA increasing $7.8m, year-over-year, or 25%. TwinSpires revenue
increased 22% y/y to $63.6m (2/3 of growth from BetAmerica, 1/3 organic), while
EBITDA increased to $16.5m. Margin of 25.9% was below our 27.5% estimate.
Racing revenue of $26.2m was in line with our estimate, though EBITDA of -$9.4m
was below our estimated -$6.7m. We note Racing is not seasonally important in the
1Q. See Figure 1.
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Daniel Politzer, CFA North America Equity Research
(1-212) 622-8170 27 April 2018
dan.politzer@jpmorgan.com
Updating estimates. Our 2018E and 2019E EBITDA go to $324m and $348m,
respectively. The delta is entirely driven by Casinos, where we model continued margin
improvement and a strong regional gaming customer. We estimate discretionary free
cash flow of $208m for 2018E and $221m for 2019E. We note our estimates do not
include any contribution from CHDN’s two pending casino acquisitions (Vicksburg and
Presque Isle), nor any contribution from its partnership with the Keeneland Association
to build two additional historical horseracing facilities.
Our year end 2018 price target goes to $280 on higher Casino EBITDA. Our
valuation is based on a SOTP approach, where we ascribe 16.0x to 2019E Derby
EBITDA, 9.0x to 2019E Casino EBITDA, and 10.0x to 2019E TwinSpires EBITDA,
plus an NPV for the historical horseracing facility (~$5 per share), less corporate
expense and 2019E end of period net debt. We note our valuation also includes option
value for Arlington (~$11) and Calder tracks ($2), and we assign ~$12 of value to
CHDN’s pending casino acquisitions. We note that in our valuation, we value the
Kentucky Derby independently of CHDN’s other racing operations, netting the modest
negative track EBITDA (estimated) at CHDN’s Calder and Fair Grounds racinos
against Casino EBITDA.
Read on. Our valuation work, easy-to-read charts, and detailed model are attached in
the body of this note.
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EBITDA:
Racing (9.4) (9.7) 0.3 -3.1% (6.7) (2.7) 39%
Margin -35.9% -37.2% 1.3% -26.0% -9.9%
Casinos 44.3 35.3 9.0 25% 37.2 7.1 19%
Margin (includes JV EBITDA) 45.2% 40.3% 4.8% 41.1% 4.1%
Wholly Owned Casino Margin 33.9% 29.1% 4.8% 29.4% 4.6%
TwinSpires 16.5 13.2 3.3 25% 17.0 (0.5) -3%
Margin 25.9% 25.2% 0.7% 27.5% -1.6%
Big Fish 0.0 0.0
Margin (as % of Bookings) 0.0% 0.0%
Other Investments 0.3 0.6 (0.3) NMF 0.0 0.3 NM
Corporate (2.5) (3.1) 0.6 NMF (3.0) 0.5 -17%
Adjusted EBITDA 49.2 36.3 12.9 35.5% 44.5 4.7 11%
Margin 26.0% 21.7% 4.3% 24.9% 1.1%
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CHDN noted both properties are in relatively good shape. For Vicksburg, this is a
property adjacent to CHDN’s Riverwalk property (they share a parking lot), so there
is opportunity for some synergies/shared services between the properties. At Presque
Isle Downs, it does 100 racing days a year, so CHDN could add some value there,
and while the property is well run, what interests CHDN most in this property is it
allows it to strategically start participating/building its capabilities in the online
gaming space in PA, which has 13 million people.
Presque Isle generated $140m of revenue and $19m of EBITDA in 2016 and has
1,600 slots and 32 table games. Lady Luck Vicksburg generated $32m of revenue
and $9m of EBITDA in 2016 and has 620 slots, 9 table games, and an 89-room hotel.
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Figure 3: We Assign ~$11 of Equity Value to Arlington Park Gaming/Land Sale Scenarios
$ in millions except per share values
Arlington Park Gaming Scenario
Days in Period 365 365 365
Number of Slots 1,200 1,200 1,200
Win/unit/day $300 $350 $400
Gross Slot Games Revenue ($ millions) $131 $153 $175
F&B and Other Revenue $15 $15 $15
Total Gross Revevnues $147 $169 $191
Less: promotional allowance (assume 5%) $7 $8 $9
Net revenues $140 $161 $182
Book Value (estimate) $100 $100 $100 $100 $100 $100 $100 $100
Gain on Sale $51 $85 $118 $152 $186 $219 $236 $253
Tax (15%) $8 $13 $18 $23 $28 $33 $35 $38
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We assign $2 of equity value to Calder, CHDN’s track located in South Florida. Our
valuation contemplates a 33% chance of a decoupling scenario, where the casino
could be run without existing racing operations. In a decoupling scenario, we believe
CHDN would look to sell the 170 acres of remaining land and terminate its lease
with the Stronach Group, who currently manages the racing operations. Given the
uncertainty on decoupling legislation, we assign a 33% probability. See Figure 4.
Book Value (estimate) $60 $60 $60 $60 $60 $60 $60 $60
Gain on Sale $17 $34 $51 $68 $85 $102 $110 $119
Tax (15%) $2 $5 $8 $10 $13 $15 $17 $18
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Figure 5: We estimate CHDN's Historical Horse Racing Facility is worth ~$5 per share
Bear Case Base Case Bull Case
Units 600 600 600
Win/unit/day $200 $225 $250
Days 365 365 365
Gross Revenue $ (millions) $43.8 $49.3 $54.8
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Valuation
At current levels, CHDN trades at 13.6x 2018E EV/EBITDA and 11.9x 2019E
EV/EBITDA. This compares with its historical average 8.1x forward-year EBITDA
multiple and its historical EV/EBITDA range of 5.7x to 11.6x. We note our estimates
do not include the impact of CHDN's pending acquisition for Vicksburg and Presque
Isle.
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Our year end 2018 price target goes to $280 on higher Casino EBITDA. Our
valuation is based on a SOTP approach, where we ascribe 16.0x to 2019E Derby
EBITDA, 9.0x to 2019E Casino EBITDA, and 10.0x to 2019E TwinSpires EBITDA,
plus an NPV for the historical horseracing facility (~$5 per share), less corporate
expense and 2019E end of period net debt. We note our valuation also includes
option value for Arlington (~$11) and Calder tracks ($2), and we assign ~$12 of
value to CHDN’s pending casino acquisitions. We note that in our valuation, we
value the Kentucky Derby independently of CHDN’s other racing operations, netting
the modest negative track EBITDA (estimated) at CHDN’s Calder and Fair Grounds
racinos against Casino EBITDA.
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Downside risks to our estimates and price target include, but are not limited to, (1)
the US horseracing industry is competitive and declining in popularity; (2) the
company is sensitive to a severe downturn in consumer/gaming spend; and (3) is
subject to adverse gaming legislation.
$ in millions, except per share data 2015 2016 1Q17 2Q17 3Q17 4Q17 2017 1Q18 2Q18E 3Q18E 4Q18E 2018E 2019E
Net Revenues :
Racing 262.2 268.1 26.1 175.7 41.9 32.9 276.6 26.2 191.6 41.3 32.3 291.5 297.3
yoy % growth 0.3% 2.3% (8.4%) 6.7% 1.5% (2.1%) 3.2% 0.4% 9.1% (1.4%) (1.8%) 5.4% 2.0%
Casinos 332.9 332.8 87.5 88.3 87.5 87.2 350.5 98.1 92.3 91.0 87.7 369.1 374.1
yoy % growth 1.4% (0.0%) 1.2% 4.6% 5.4% 10.5% 5.3% 12.1% 4.6% 4.1% 0.5% 5.3% 1.3%
TwinSpires 201.3 221.9 52.3 80.8 66.1 57.5 256.7 63.6 87.3 71.6 62.4 284.9 297.7
yoy % growth 5.8% 10.2% 5.2% 18.0% 20.0% 18.3% 15.7% 21.6% 8.1% 8.3% 8.6% 11.0% 4.5%
Big Fish Games 413.7 486.2 112.0 112.6 117.9 342.5
yoy % growth NA 17.5% (8.3%) (10.1%) (3.6%) (29.6%)
Other Investments 20.1 20.8 5.5 6.5 5.7 6.0 23.7 5.5 6.5 10.0 17.0 39.0 70.3
Corporate/Eliminations (18.0) (21.2) (3.9) (12.0) (4.3) (4.7) (24.9) (4.1) (5.0) (5.0) (5.0) (19.1) (19.1)
Total Net Revenues 1,212.2 1,308.6 279.5 451.9 314.8 178.9 1,225.1 189.3 372.8 208.9 194.4 965.4 1,020.3
yoy % growth 49.3% 7.9% (3.1%) 3.1% 3.8% (35.7%) (6.4%) (32.3%) (17.5%) (33.6%) 8.7% (21.2%) 5.7%
EBITDA
Racing 71.8 79.7 (9.7) 98.7 1.7 (6.2) 84.5 (9.4) 109.2 1.7 (6.1) 95.4 102.1
Margin 27.4% 29.7% (37.2%) 56.2% 4.1% (18.8%) 30.5% (35.9%) 57.0% 4.1% (18.8%) 32.7% 34.3%
Casinos 114.9 125.8 35.3 37.5 39.5 33.7 146.0 44.3 40.0 41.5 35.1 160.9 166.2
Margin (includes JV EBITDA) 34.5% 37.8% 40.3% 42.5% 45.1% 38.6% 41.7% 45.2% 43.3% 45.6% 40.0% 43.6% 44.4%
Wholly Owned Casino Margin 28.6% 29.3% 29.1% 29.8% 30.6% 27.8% 29.3% 33.9% 30.7% 31.3% 28.7% 31.2% 31.9%
TwinSpires 48.6 55.2 13.2 19.3 18.8 13.1 64.4 16.5 21.2 20.4 14.2 72.3 75.5
Margin 24.1% 24.9% 25.2% 23.9% 28.4% 22.8% 25.1% 25.9% 24.3% 28.4% 22.8% 25.4% 25.4%
Other Investments 2.9 2.7 0.6 1.3 1.1 0.7 3.7 0.3 0.3 1.2 3.7 5.5 14.8
Corporate (4.2) (8.1) (2.4) (2.1) (2.1) (3.7) (10.3) (2.5) (2.5) (2.5) (2.5) (10.0) (10.3)
Adjusted EBITDA 302.5 334.5 57.3 173.0 76.0 37.6 343.9 49.2 168.2 62.3 44.4 324.1 348.3
Margin 25.0% 25.6% 20.5% 38.3% 24.1% 21.0% 28.1% 26.0% 45.1% 29.8% 22.9% 33.6% 34.1%
yoy % growth 49.4% 10.6% 22.7% 8.0% 6.9% 23.3% 2.8% 35.5% 8.1% 4.0% 18.1% 13.3% 7.5%
FAS 123 Expense (13.8) (18.9) (4.9) (6.7) (5.8) (5.3) (22.7) (6.1) (6.1) (6.1) (6.1) (24.4) (24.4)
Depreciation and Amortization (109.8) (108.6) (24.5) (24.8) (24.0) (14.0) (87.3) (13.8) (13.8) (13.8) (13.8) (55.2) (55.2)
Big Fish Deferred Revenue and Adjustments (21.7) (4.9)
Less JV EBITDA (19.8) (28.2) (9.8) (11.2) (12.8) (9.5) (43.2) (11.0) (11.7) (13.1) (9.9) (45.6) (46.8)
Other/Miscellaneous (13.8) 20.3 (0.6) (0.8) (0.4) (21.6) (23.5) 1.4 1.0 1.0 1.0 4.4 4.4
Operating Income 123.6 194.2 17.5 129.5 33.0 (12.8) 167.2 19.7 137.7 30.3 15.6 203.3 226.3
Net Interest Expense (28.6) (43.7) (11.8) (11.6) (12.6) (13.2) (49.2) (9.6) (10.3) (9.4) (9.2) (38.5) (30.8)
Equity in income of unconsolidated investments 11.2 17.4 6.1 7.7 8.9 2.8 25.5 6.5 7.9 9.2 2.9 26.5 27.3
Other 5.9 0.2 0.0 0.2 (1.0) (20.2) (21.0) 0.1 0.0 0.0 0.0 0.1 0.0
Income Before Taxes (continuing operations) 112.1 168.1 11.8 125.8 28.3 (43.4) 122.5 16.7 135.2 30.1 9.3 191.3 222.7
Provision for Taxes (46.9) (60.0) (4.5) (47.5) (11.6) 77.8 14.2 (2.6) (33.1) (7.4) (2.3) (45.4) (54.6)
Tax Rate 41.8% 35.7% 38.1% 37.7% 41.0% NMF (11.6%) 15.6% 24.5% 24.5% 24.5% 23.7% 24.5%
Net Income (Loss) from continuing ops 65.2 108.1 7.3 78.3 16.7 34.4 136.7 14.1 102.1 22.7 7.0 146.0 168.2
Income from discontinued ops (net of tax) 3.8 3.8 167.9
Net Income (Loss) 38.2 38.2 182.0
Adjustments to Net Income 1.7 1.7 0.0
Adjusted Net Income 15.8 102.1 22.7 7.0 147.7 168.2
Adj. EPS $3.68 $6.38 $0.44 $4.81 $1.08 $2.22 $8.54 $1.09 $7.53 $1.68 $0.52 $10.81 $12.40
yoy % growth 42.2% 73.6% 164.1% 17.1% 108.7% 39.1% 33.8% 150.5% 56.7% 55.6% (76.7%) 26.7% 14.7%
Fully Diluted Shares Outstanding 17.6 16.9 16.8 16.3 15.5 15.5 16.0 14.5 13.6 13.6 13.6 13.8 13.6
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Equals Normalized Free Cash Flow 178.6 184.7 9.0 106.2 43.0 (10.1) 148.1 13.2 129.6 33.6 32.0 208.3 221.2
Less: Project/Growth Capex (12.5) (23.8) (27.3) (18.8) (16.3) (21.2) (83.6) (26.5) (46.0) (47.0) (10.5) (130.0) (30.0)
Less: Acquisitions 0.0 0.0 (23.1) (23.1) 0.0 0.0
Less: Payment of Big Fish Earnout (282.0) (34.2) (34.2) (62.6) (62.6) 0.0
Less: Share repurchase (7.8) (163.9) (171.7) (514.4) (514.4) 0.0
Plus: Asset Sales 6.0 26.5 0.0 970.7 970.7 0.0
Plus/Less: Other (45.1) (18.6) 20.2 (16.6) (62.7) 12.1 (47.0) 13.6 (24.0) (10.4) 0.0
Equals Excess FCF Used to Reduce Debt (11.1) (140.8) (40.1) (116.2) (36.0) (19.2) (211.5) 394.0 59.6 (13.4) 21.5 461.6 191.2
Balance Sheet Summary 2015 2016 1Q17 2Q17 3Q17 4Q17 2017 1Q18 2Q18E 3Q18E 4Q18E 2018E 2019E
Cash 74.5 48.7 54.9 41.8 57.8 51.7 51.7 202.7 102.7 102.7 102.7 102.7 62.4
Debt 781.8 927.5 973.8 1,076.9 1,128.9 1,142.0 1,142.0 899.0 739.4 752.9 731.4 731.4 500.0
Net Debt 707.3 878.8 918.9 1,035.1 1,071.1 1,090.3 1,090.3 696.3 636.7 650.2 628.7 628.7 437.6
Change in Net Debt 11.1 171.5 40.1 116.2 36.0 19.2 211.5 (394.0) (59.6) 13.4 (21.5) (461.6) (191.2)
Equity (adjusted for non-controlling interests) 617 685 689 601 626 918 918 394 496 519 526 526 673
Credit Ratios
Net Debt/EBITDA (TTM) 2.3x 2.6x 2.7x 2.9x 3.0x 3.2x 3.2x 2.1x 1.9x 2.0x 1.9x 1.9x 1.3x
EBITDA/Interest (TTM) 10.6x 7.7x 7.7x 7.9x 7.7x 7.0x 7.0x 6.4x 6.9x 7.5x 8.4x 8.4x 11.3x
Net Revenue 262.2 268.1 26.1 175.7 41.9 32.9 276.6 26.2 191.6 41.3 32.3 291.5 297.3
11.1% -1.5%
TwinSpires Drivers 2015 2016 1Q17 2Q17 3Q17 4Q17 2017 1Q18 2Q18E 3Q18E 4Q18E 2018E 2019E
Industry Handle 1.2% 0.6% -1.0% 1.2% 3.8% 2.3% 1.6% 6.2%
Total Handle ($ mm) 965.1 1,096.9 252.9 402.9 338.6 288.2 1,282.6 304.1 435.1 355.5 302.6 1,397.4 1,467.2
yoy % growth 7.5% 13.7% 6.8% 19.6% 20.7% 18.8% 16.9% 20.2% 8.0% 5.0% 5.0% 8.9% 5.0%
Net pari-mutuel revenues 183.6 201.8 47.0 74.1 61.2 52.5 234.8 56.3 80.0 64.3 55.1 255.7 268.5
Net Revenue as % of Handle 19.0% 18.4% 18.6% 18.4% 18.1% 18.2% 18.3% 18.5% 18.4% 18.1% 18.2% 18.3% 18.3%
Other 17.7 20.1 5.3 6.7 4.9 5.0 21.9 7.3 7.3 7.3 7.3 29.2 29.2
Net Revenue 201.3 221.9 52.3 80.8 66.1 57.5 256.7 63.6 87.3 71.6 62.4 284.9 297.7
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Oxford (ME)
Net Casino Revenues 80.4 84.6 20.9 23.1 25.2 21.6 90.8 24.2 25.2 27.7 22.2 99.3 101.3
yoy growth 5.1% 5.2% 5.0% 9.5% 3.3% 12.5% 7.3% 15.8% 9.0% 10.0% 3.0% 9.4% 2.0%
Riverwalk (MS)
Net Revenues 49.8 46.1 11.5 12.0 12.2 12.5 48.2 14.4 12.6 12.2 12.5 51.7 51.7
yoy growth -0.7% -7.4% -9.4% -3.2% 15.1% 20.2% 4.6% 25.2% 5.0% 0.0% 0.0% 7.3% 0.0%
Harlow's (MS)
Net Revenues 49.0 48.4 13.5 12.5 12.3 11.7 50.0 13.3 12.5 12.3 11.7 49.8 49.8
yoy growth -2.4% -1.2% 3.8% 5.0% 5.1% -0.8% 3.3% -1.5% 0.0% 0.0% 0.0% -0.4% 0.0%
Calder (FL)
Net Revenues 77.3 79.1 21.4 21.8 19.4 22.8 85.4 24.3 22.7 19.6 21.7 88.2 88.7
yoy growth 0.4% 2.3% 5.4% 6.3% 2.1% 18.1% 8.0% 13.6% 4.0% 1.0% -5.0% 3.3% 0.5%
VSI (LA)
Net Revenues 36.9 36.9 9.7 9.8 9.3 9.5 38.3 11.0 10.3 10.2 10.5 42.0 44.5
yoy growth 9.7% -0.1% -1.0% 3.2% 8.1% 5.6% 3.8% 13.4% 5.0% 10.0% 10.0% 9.6% 6.0%
Other (Saratoga) 0.4 0.8 0.3 0.3 0.4 0.3 1.3 0.3 0.3 0.3 0.3 1.2 1.2
Wholly-owned Casino Net Revenues 332.9 332.8 87.5 88.3 87.5 87.2 350.5 98.1 92.3 91.0 87.7 369.1 374.1
yoy growth 1.4% 0.0% 1.2% 4.6% 5.4% 10.5% 5.3% 12.1% 4.6% 4.1% 0.5% 5.3% 1.3%
Operating Expenses:
Gaming Taxes:
Oxford (ME) 32.4 33.9 8.3 9.3 10.1 8.5 36.1 9.5 10.1 11.1 8.7 39.5 40.3
Table Tax Rate 18.0% 18.0% 18.0% 18.0% 18.0% 18.0% 18.0% 18.0% 18.0% 18.0% 18.0% 18.0% 18.0%
Slot Tax Rate 48.0% 48.0% 48.0% 48.0% 48.0% 48.0% 48.0% 48.0% 48.0% 48.0% 48.0% 48.0% 48.0%
Riverwalk (MS) 6.0 5.5 1.4 1.4 1.5 1.5 5.8 1.7 1.5 1.5 1.5 6.2 6.2
Gaming Tax Rate 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0%
Harlow's (MS) 5.9 5.8 1.6 1.5 1.5 1.4 6.0 1.6 1.5 1.5 1.4 6.0 6.0
Gaming Tax Rate 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0% 12.0%
Calder (FL) 26.1 26.0 7.2 7.3 6.5 7.6 28.6 8.2 7.6 6.5 7.2 29.6 29.7
Gaming Tax Rate 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0% 35.0%
Fair Grounds (LA) 17.8 16.9 4.7 4.0 4.0 4.0 16.8 4.8 4.0 4.0 4.0 16.9 16.9
Gaming Tax Rate 40.5% 40.5% 40.5% 40.5% 40.5% 40.5% 40.5% 40.5% 40.5% 40.5% 40.5% 40.5% 40.5%
VSI (LA) 11.1 11.1 2.9 2.9 2.8 2.9 11.5 3.3 3.1 3.1 3.1 12.6 13.3
Tax Rate 30% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0% 30.0%
Sub-total Gaming Taxes 99.2 99.3 26.1 26.5 26.3 25.9 104.8 29.1 27.9 27.7 26.0 110.7 112.4
Other Opex 138.6 135.9 35.9 35.4 34.4 37.1 142.9 35.7 36.1 34.9 36.5 143.2 142.3
As a % of Total Net Revenues 41.6% 40.8% 41.0% 40.1% 39.3% 42.6% 40.8% 36.4% 39.1% 38.3% 41.6% 38.8% 38.0%
Total Opex 237.8 235.2 62.0 62.0 60.8 63.0 247.7 64.8 64.0 62.6 62.5 253.9 254.7
Wholly Owned Casino EBITDA 95.1 97.6 25.5 26.4 26.8 24.2 102.8 33.3 28.3 28.5 25.2 115.3 119.4
Margin % 28.6% 29.3% 29.1% 29.8% 30.6% 27.8% 29.3% 33.9% 30.7% 31.3% 28.7% 31.2% 31.9%
JV EBITDA - 50% MVG 19.1 22.4 6.4 6.5 5.8 5.6 24.3 6.8 6.7 5.9 5.7 25.1 25.7
JV EBITDA - 25% SCH 0.7 5.8 3.4 4.7 7.0 3.9 19.0 4.2 5.0 7.2 4.2 20.5 21.1
Total Casino Adjusted EBITDA 114.9 125.8 35.3 37.5 39.5 33.7 146.0 44.3 40.0 41.5 35.1 160.9 166.2
Margin 34.5% 37.8% 41.7% 43.6% 44.4%
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Source: Bloomberg and J.P. Morgan; price data adjusted for stock splits and dividends.
Initiated coverage Sep 22, 2016.
The chart(s) show J.P. Morgan's continuing coverage of the stocks; the current analysts may or may not have covered it over the entire
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J.P. Morgan ratings or designations: OW = Overweight, N= Neutral, UW = Underweight, NR = Not Rated
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Coverage Universe: Politzer, Daniel B: Churchill Downs (CHDN), Eldorado Resorts (ERI)
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