Analyst: Promising Year Ahead For Regional Casinos, But Vegas Faces Challenges

A Truist Securities investor note published Tuesday by analyst Barry Jonas offered an assortment of forecasts for the year ahead in the gaming industry and expressed bullish expectations for land-based casinos — at least outside of Las Vegas.

“Land-based gaming should remain ok-to-good in 2026, though a return to growth in the challenged Las Vegas is not certain,” Jonas wrote.

The note then elaborated, “Despite many macro concerns, regional gaming saw a return to growth in ’25, perhaps boosted by trade-down as Vegas visitation suffered.”

Jonas spelled out that forthcoming tax refunds should put a little extra spending money in some players’ pockets and boost gambling handle in certain ways, though he noted the stimulus is “likely not as powerful as COVID stimulus.”

He concluded on the topic, “While we’d never write off Las Vegas, we think the leisure challenges will overshadow a strong group outlook for a bit longer.”

Ultimately, Jonas is saying that the availability of casinos all over the country is chipping away at travel to Vegas, while the expenses and challenges associated with traveling to Vegas are working out to the benefit of those smaller, regional casinos.

Other Truist notes

Jonas singled out a handful of gaming companies as recommended “buys,” most notably Churchill Downs and Gaming & Leisure Properties Inc. (GLPI).

“We favor Churchill Downs,” Jonas wrote, “expecting strong land-based growth on the heels of new projects and the irreplaceable Kentucky Derby.”

Churchill Downs began the new year with a key court win in Michigan regarding its advance-deposit wagering app.

For real estate investment trust (REIT) GLPI, whose portfolio includes 69 properties across the country (all outside Nevada), Jonas made the recommendation based on its “diverse growth pipeline and more flexible balance sheet.”

In general, Truist is high on gaming REITs, despite a “challenging” 2025.

“We see more potential upside this year,” Jonas wrote, “as a stable/improving rate/capital market environment should facilitate more accretive sale leasebacks as we think operators likely use some form of M&A to try to right size their own valuations. We’re most closely watching Caesars (CZR, Buy) and VICI (VICI, Buy) regional lease drama … and think a creative win/win solution could help both companies and perhaps the wider sector.”