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Breaking down the importance of the Kentucky Derby to Churchill Downs

With the Kentucky Derby back on for the upcoming weekend, Churchill Downs may get a much needed win. This comes just days after Churchill Downs released a statement addressing racial inequality and injustice. Yahoo Fnance’s Ines Ferre joins The Final Round panel to discuss.

Video Transcript

SEANA SMITH: Well, turning our attention to sports, after getting postponed because of the coronavirus pandemic, the Kentucky Derby is scheduled to take place tomorrow. And this year is obviously going to be unique, as everything is and seems to be in 2020. It's going to be a little bit quieter. Ines Ferre has a little bit more on this for us. And Ines, spectators aren't going to be in the stands for the first time in history. So what can we expect tomorrow?

INES FERRE: Well, we can expect the Kentucky Derby to be streamed. It is going to be streamed on NBC Sports and also on Fox Sports 2. But certainly, the most notable change, of course, this year is no spectators in the stands, no fancy hats. Actually, Churchill Downs, the racetrack company, had been given permission to have spectators in there, to have about 23,000. That would be a limited capacity because normally this event attracts about 150,000.

But then it was announced that there would be no spectators later in August. And that actually prompted a downgrade from Susquehanna, which downgraded the stock to neutral with a price target of $185. Actually, earlier this week, this stock touched to new highs.

But certainly, there will be no pomp and circumstance. This will be like no other Kentucky Derby. And the Derby is really one of the company's biggest moneymakers. It makes money off of off-track betting, online betting, ticket sales, also sponsorships. So there will be no food, no beverages, of course, sold. But the online betting, that is expected to do well.

SEANA SMITH: Yeah, Ines, I wanted to ask you about the online betting because I was reading some figures from last year. I think more than $165 million was bet on the Kentucky Derby. So what are they expecting this year, just in terms of the turnout? Because at the same time, while maybe we're not see obviously as much money generated in person, there is this pent-up demand, and we're seeing more and more people participate in sports betting.

INES FERRE: Sure, that's right. And it's-- when it comes to horse racing, actually, it is legal online in 31 states. That's more than other types of sports. This is including also Pennsylvania, New York, Florida, so a wider audience that can participate in online betting. And Churchill Downs' online division revenue this year is expected to grow 46%. So the-- main site, which is the official betting site for Churchill Downs, but certainly, online betting is expected to be strong.

SEANA SMITH: All right, Ines, thank you for that update.