The Kentucky Derby is a time-honored tradition that takes place on the first Saturday of May every year. This iconic event has been held for 151 consecutive years at the legendary Churchill Downs racetrack in Kentucky. As the “Run for the Roses” approaches, horse racing enthusiasts are gearing up for the excitement and pageantry that comes with one of the most prestigious events in the sporting world.
Churchill Downs, the company behind the Kentucky Derby, is not just a one-trick pony. While the Derby attracts a lot of attention and betting action, Churchill Downs has a broader story that investors should take notice of. The company’s revenue in 2025 reached $2.92 billion, with earnings before interest, taxes, depreciation, and amortization (EBITDA) totaling $1.2 billion. While the Derby is a significant part of their business, it is only a small piece of the puzzle.
Churchill Downs’ main sources of revenue come from historical racing machines (HRMs) and regional casinos. These HRMs, which allow bettors to wager on previously run horse races, are a lucrative business for the company. With 10,000 devices across 16 locations in Kentucky and Virginia, Churchill Downs has found a winning formula that contributed $1.44 billion to their revenue and $637 million to their adjusted EBITDA in 2025.
In addition to their HRM business, Churchill Downs also owns and operates 10 gaming venues in nine states and has equity interests in others. These regional casinos provide a stable source of income for the company, as they are conveniently located within driving distance for many customers. This geographical advantage helps Churchill Downs navigate through market fluctuations and economic challenges that may impact destination gaming markets like the Las Vegas Strip.
One of the appealing aspects of investing in Churchill Downs is that the company owns all of its real estate, which strengthens its balance sheet and provides financial stability. This has allowed Churchill Downs to reward shareholders through share repurchases and dividend increases. Since 2015, the company has repurchased $2.1 billion of its shares and recently announced its 15th consecutive dividend hike in January.
While Churchill Downs is a solid investment opportunity, it’s essential to explore other potential stocks that could offer significant returns in the future. The Motley Fool’s Stock Advisor team has identified the 10 best stocks for investors to buy now, and Churchill Downs did not make the cut. This curated list of stocks has historically outperformed the market, with returns that could potentially dwarf traditional investments like Netflix and Nvidia.
As the Kentucky Derby approaches, investors may want to consider Churchill Downs as a long-term investment opportunity. With a diverse revenue stream, strong financial foundation, and a track record of shareholder rewards, Churchill Downs is well-positioned to deliver value to investors in the years to come.
