Jefferies Tweaks Estimates & Price Targets on Company's In Gaming Industry Ahead of Q1 Results

Jefferies is really anticipating this earnings season to provide some light on how exactly the gaming industry is performing.

The firm comments that it does not believe that investors will come away with the substantive indication they were looking for in order to exact judgment. It suspects that investors will continue to wait for some more meaningful and definitive change to arrive, which may or may not come soon.

Some key points of Jefferies broader discussion:

• The Midwest regional markets remained in a sideways pattern through 1Q11.
• The level of interest in the Atlantic City market continues to improve given that there are definitive plans to spend capital in this market.
• A recovery in Las Vegas remains a matter of controversy – discrepant not as to whether there will be one, but as to its composition and trajectory.
• The most positive environment in gaming remains Macau and Singapore.
• As the slot companies continue to pursue demand with new slot product, such endeavors have thus far proven futile given not only regulatory hurdles and execution challenges, but also a highly sensitized appetite for capital investment.
  

Ahead of Q1 earnings, the firm is raising its price target from $18 to $21 and is maintaining its Hold rating on shares of Ameristar Casinos Inc. (Nasdaq: ASCA).� It is also increasing its FY11 and FY12 estimates from $1.08 and $1.16 to $1.50 and $1.61.

Jefferies is lowering its price target on shares of Boyd Gaming Corp. (NYSE: BYD) from $12 to $10 and its FY11 and FY12 estimates from $0.15 and $0.37 to $0.10 and $0.33. It is reiterating its Hold rating.

The firm is raising its FY11 and FY12 estimates on shares of Pinnacle Entertainment Inc. (NYSE: PNK) from $0.29 and $0.48 to $0.38 and $0.64, but is maintaining its $18 price target and Buy rating.

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