Raymond James upgraded Speedway Motorsports (TRK) to strong buy from outperform.
Analyst Joseph Hovorka says he concurrently raised his 2004 earnings per share estimate to $1.78, which is entirely based on the growth of the company's TV contract with NASCAR. He notes that with the improving economy, and a new truck race in Atlanta, that there still could be additional upside to his estimates.
After showing decelerating EBITDA growth over the last two years, Hovorka thinks growth should begin to accelerate in 2004 as a result of the NASCAR TV contract escalation. At current prices, he thinks Speedway trades towards the lower end of its historic range, at a discount to its peer International Speedway. He has a $35 price target.