S&P reduces outlook on Boyd Gaming's ratings

S&P also affirmed the Las Vegas-based company's ratings, including its noninvestment-grade "BB" corporate credit rating.

Standard & Poor's credit analyst Ben Bubeck said Boyd has not yet arranged financing for the two joint-venture components of its Echelon resort complex on the Las Vegas Strip. The costs of the joint project, which is owned with Morgans Hotel Group, are expected to total $1.5 billion.

"The failure to secure financing in the near term could pressure the company's ability to meet its targeted completion for these portions of the project in the third quarter of 2010," Bubeck said, noting that a delay in opening part of the development could strain the company's financial performance.

"We feel good about our ability to finance the Morgans piece," said Vice President Rob Stillwell. "As long as we get it done this year, it will not change the opening of Echelon. Both companies are very commited to the project."

The analyst noted that many of the company's other properties are underperforming, mostly because of economic pressures.

S&P noted, however, that the company has a relatively diverse portfolio of gaming properties, which are expected to generate relatively steady long-term cash flow.

Boyd Gaming shares fell 48 cents, or 3.5 percent, to $13.14 in afternoon trading. The stock has fallen from a 52-week high of $54.22 last July to a multiyear low of $12.90 on Tuesday.