Boyd up as analysts worry about Las Vegas locals weakness

Boyd's earnings may be pressured by a decline in gaming revenue at the casinos that Las Vegas residents frequent, with Sterne Agee & Leach Inc. analyst Nicholas A. Danna IV reporting the market's gaming revenue slipped 8.4 percent for the January and February period.

Justin Sebastiano of Morgan Joseph & Co. said increased promotions in the Las Vegas locals market may also hurt Boyd.

"This will likely keep a lid on margins and profitability, in our view, which does not bode well for Boyd Gaming," the analyst wrote in a client note.

Sebastiano expects first-quarter profit of 33 cents per share on revenue of $477.1 million.

Danna also predicts increased competition, particularly from Cannery Casino Resorts' Eastside Cannery Casino in Nevada, could weigh on results later in the year.

Danna reaffirmed a "Hold" rating and cut his price target to $20 from $28. He also trimmed his first-quarter earnings per share estimate to 31 cents from 34 cents and lowered his 2008 forecast to $1.20 from $1.29.

Analysts surveyed by Thomson Financial expect first-quarter net income of 32 cents per share on revenue of $483.7 million.

Las Vegas-based Boyd is set to report first-quarter financial results on Tuesday.

Shares of Boyd Gaming gained 46 cents, or 2.5 percent, to $18.56 in afternoon trading. The stock has traded in a 52-week range of $17.10 to $54.22.