Churchill Downs' board of directors approved Monday the repurchase of up to 55,000 shares of company stock.
"The board took this action to support the financial markets in this time of national crisis," said Tom Meeker, president and chief financial officer for the racing conglomerate based in Louisville, Ky. "As evidenced by the SEC's emergency order, there is a likelihood the financial markets will experience some short-term volatility. The action taken by the board is done with a view toward lessening the volatility in our stock and the markets as a whole."
The Securities and Exchange Commission (SEC) waived several rules Monday to encourage buying when the markets reopened after a four-day shutdown. Among the rules waived was a prohibition on companies buying their own stock during first and last 30 minutes of trading. The rule was created to prevent companies from manipulating their stock price. The SEC has said the rule could be waived up to 10 days. Companies also are allowed to increase the daily purchases of their stock by 100% of the previous month's average volume, and corporate insiders--officers and directors -- may freely buy company's stock regardless of the date of their last purchase.
At the close of trading Monday, Churchill Downs stock was down 30 cents per share to $29.45, or a drop of 1% off the opening day price of $29.75
Trading was volatile throughout the day for other companies affiliated with Thoroughbred racing. Here is how they fared:
Anchor Gaming, parent company of United Tote, took the biggest loss of the day among racing stocks. The company lost $7.52 per share, or drop of 14.6%, to close at $43.98,
Gemstar-TV Guide, the parent company of the TV Games Network, was down $6.52 to $18.92,
Magna Entertainment was down $1.05 to $6.05,
Penn National Gaming was down $2.85 to $15.20,
Youbet.com online wagering service dropped 34 cents per share to $1.35,
MTR Gaming, owner of Mountaineer Park, fell $1.02 to $9.15,
Gtech, co-owner of Turfway Park, dropped $1.35 to $30.90,
Dover Downs was down 90 cents to close at $12.90,
Scientific Games, formerly known as Autotote, dropped 43 cents per share to $3.76, and
Canterbury Park dropped 10 cents a share to $7.
Maxxam, the parent company of Sam Houston Race Park, was the only racing stock to rise. Its price was up $2.90 to $21.50 on the heels of a regulatory victory. A judge has rejected a federal banking agency's efforts to force Maxxam chairman Charles Hurwitz and his company to pay about $820 million in damages for the 1988 failure of a Texas savings and loan.
For the market overall, the Dow Jones Industrial average was down 671.95 points or a loss of 7.1%, the Nasdaq market was down 115.7 points or 6.8%, and the New York Stock Exchange was down 26 points for a loss of 4.6%.
