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Penn National Gaming (PENN)  rating was lowered to "neutral" from "overweight" by analysts at JPMorgan Thursday due to increased competition at its Charleston, WV casino from the recently opened $1.4 billion MGM National Harbor (MGM) property in neighboring Maryland.

Penn National shares closed trading down 1.91% to $14.38 on heavy volume Thursday. 

However, the firm is still bullish on the regional gaming sector and named Pinnacle Entertainment (PNK) and Boyd Gaming  (BYD)  as the best regional gaming plays in 2017 as strong cash flow yields across the entire sector make regional gaming an attractive play. Regional gaming companies operate domestically. 

"We generally like the U.S. regional gaming sector heading into 2017, with year-over-year comparisons relatively easy starting in the 2Q17 and we highlight mostly attractive free cash flow yields across the board as reasons to be positive here," JPMorgan analysts said. 

The firm expects Pinnacle's Louisiana and Midwest properties to perform better than previously expected, and raised the company's 12-month price target to $18 from $17.

While still positive on the company, the firm lowered estimates for Boyd Gaming's properties in the Midwest and South regions. JPMorgan maintained its 12-month price target of $24, implying a potential upside of 15.2% from the stock's opening price of $20.82 on Thursday.

The firm maintained its $26 price target on Red Rock Resorts (RRR) , slightly above the Las Vegas-based company's $24.41 closing price on Wednesday. "We see RRR as a concentrated play on macro improvements in the Las Vegas locals markets, driving solid same-store growth there," analysts wrote. 

Pinnacle closed trading up 0.81% to $15.  Boyd Gaming rose 0.38% $20.90, and Red Rock Resorts fell 2.17% to $23.88.