Group and convention business in Las Vegas is performing as expected, Jefferies Equity Research analyst David Katz wrote in an April 6 investor note. However, leisure-customer “weakness continues to persist,” finally spilling over into the locals market.
Consequently, Katz was continuing to keep a “tempered” stance toward the Las Vegas Strip. “The more economically sensitive portion of gaming demand is likely to face continued near‑term headwinds, as consumers contend with elevated airfares [fares],” he explained.
Katz added that the less-than-solid Strip performance was, he suspected, starting to dampen locals-casino business. He singled out Boyd Gaming, predicting a 4.7 percent cash-flow slump at its Nevada properties.
“Despite near‑term pressure,” Katz allowed, “we continue to prefer locals exposure, supported by improving demographic trends and the expected ramp of recent capital projects, including Cadence Crossing and [Station Casinos’s] Green Valley Ranch.”
Station’s share price, he continued, already accounted for the headwinds facing Sin City. He said the company’s leading position in the Vegas-locals market supported “our confidence that returns on recent capital investments should meet or exceed stated targets over time.” Nevertheless, he lopped $5 a share off his price target, bringing it down to $74 per share.
Boyd was, Katz felt, “managing through sluggish destination travel. … That said, we believe the completion of recent renovations at Suncoast, Orleans, and Cadence Crossing should support a return to growth” in the latter half of 2026. Newer products and marketing initiatives would help, he said.
Katz also felt that a heretofore flat Midwest/South Boyd portfolio was now looking at a 1.4 percent cash-flow improvement. He trimmed $2 from his per-share price target, down to $108 apiece.
Turning to another domestic operator, Caesars Entertainment, Katz observed that leisure travel didn’t improve in the first quarter of 2026. He felt cash-flow growth would not be seen until July or later.
Caesars would benefit, he said, “from the realignment of two managed properties and the completion of the Tahoe renovation during the summer, which should support improved operating trends” for a company largely propelled by its online performance. Katz boosted his price target on Caesars shares to $26 apiece from $24.
Turning to regional casinos, the analyst, described the political atmosphere around them as noisy. Despite a slew of gambling-related bills introduced in state legislatures, Katz dismissed them as “more noise than measurable impact.”
Outliers were the advancement of igaming in Maine and the authorization of a new casino in Indiana. Still, Katz said, “The broader competitive dynamics across regional gaming remain largely unchanged.”
Also unchanged was Katz’s price target on Penn Entertainment: $16. He felt the regional operator’s cash-flow growth was limited by “outsized exposure” in New England and ongoing construction at some of its Midwest casinos.
“That said, we expect profitability improvements in the Interactive segment to be the primary driver of overall growth,” Katz wrote, predicting 24.2 percent cash-flow improvement in 2026. He also thought the stock would benefit from ongoing share buybacks and corporate debt reduction.
“Against this backdrop, we believe companies that continue to clearly define and execute on internal growth opportunities should be viewed favorably, particularly given the more challenging supply environment,” Katz continued. He singled out Churchill Downs for solid growth, both from gaming-machine deployment and the upcoming Kentucky Derby.
Katz wrote that Churchill Downs had dodged multiple bullets in Virginia, particularly with the legislature having postponed consideration of igaming. A potential casino in Fairfax County would, he said, face multiple layers of approval, including a potential veto from Gov. Abigail Spanberger. He also felt that Spanberger might still nix the legitimization of gray-market “skill games.” Even so, he brought Churchill Downs’s price target per share down to $139 apiece from $143.
As for one other regional operator, Monarch Casinos & Resorts, Katz indicated modest improvement in the merger-and-acquisition climate. But Monarch was showing discipline, “with a continued focus on transactions that offer clear and measurable return opportunities.”
Still, Katz opined, a clear path did not exist for Monarch to outperform its rivals. Minus “a new growth avenue … management’s execution track record is proven, and the company’s assets remain among the highest quality in their respective markets, supporting downside protection despite a more limited growth outlook.” Even so, he rated Monarch stock a Hold, with a price target of $103 per share.
Shifting his focus to international gaming, Katz described Wynn Al Marjan, in the war-torn United Arab Emirates, as being “in the crosshairs. The ongoing conflict involving the U.S./Israel and Iran has prompted markets to reassess the appropriate discount rate for adjacent Middle East economies, including the UAE. We believe it remains difficult to handicap both the timeline for military de‑escalation and the subsequent recovery in foreign visitation to the region,” he elaborated.
That said, Katz left his projections for the project as is. But he did warn of a potentially extended construction timeline for the Persian Gulf resort.
In Macau, Katz believed Wynn would continue to outperform its competitors, thanks to a focus on high-end customers. He predicted that cash flow would accelerate 16.2 percent at Wynn Macau and 11.8 percent at newer Wynn Palace. Even so, Katz shaved $12 per share off his Wynn price target, lowering it to $150 apiece.