Many have regarded the casino industry as recession proof. But casinos all over the country, including key gambling centers like Las Vegas and Atlantic City, have been “down on their luck” because of the recession. Now it looks like the market trends that began in 2008 will continue for the next 18 months. The Las Vegas Review Journal turns to Moody for market analysis:
In a report on the American gaming industry, [Moody}the bond rating service told clients it had a negative outlook for the casino business over the next 12 to 18 months. Moody’s Senior Vice President Keith Foley said trends that began in 2008 have not shown any “tangible signs” of stabilization.
“Our outlook for the U.S. gaming industry remains negative amid uncertainty about the timing and degree of a recovery,” Foley wrote in a report updating December’s market research. The bonds from 72 percent of U.S. gaming companies have been given a negative outlook by Moody’s or face a possible downgrade. Foley said gaming’s biggest risk is the possibility consumers will further reduce discretionary spending over the next 18 months.
Some of the biggest areas hit are the two main gambling centers, Vegas and Atlantic City. Such negative trends are putting serious pressure on current casino companies. The Review Journal continues:
He was especially harsh on casino companies operating on the Strip and Atlantic City. Both markets have seen double-digit gaming revenue declines in the first four months of 2009. Foley isn’t predicting a quick recovery.
“We do not assume that because gaming demand declined along with the economy, it will return to pre-recession levels once the economy improves,” he said. Las Vegas was hit harder by the recession than any American gaming market. Negative trends have put significant pressure on the major casino companies.