NEW YORK ( TheStreet) -- The casino sector is in the spotlight Tuesday after J.P. Morgan revised its outlook on several stocks, and as the sector prepares to release first-quarter earnings.

Las Vegas Sands ( LVS) saw its price target hiked by J.P. Morgan to $29 from $23, as Las Vegas Sands rolls out its Singapore casino, and as room rates and occupancy levels on the Las Vegas Strip improve.

J.P. Morgan also declared that it still sees upside from MGM Mirage ( MGM), lifting its price target on MGM to $17 from $14.

J.P. Morgan analyst Joseph Greff said he expects 2011 will be a much better year for the convention and group business, with stronger volumes and increased pricing. "We think MGM's Las Vegas Strip group/convention bookings are underappreciated and not reflected in the stock's valuation or in buy/sell-side expectations," he wrote in a note.

Goldman Sachs also boosted MGM's price target to $17.50 from $14.50. The brokerage firm said its is confident that MGM will close on all of its planned asset sales as it looks to reduce debt.

Greff also believes Wynn Resorts ( WYNN) can run as high as $88 a share, as he is optimistic on the company's Macau operations and believes its Encore opening in the Chinese enclave will provide a boost to shares.

In response, the casino operator hit a 52-week high Tuesday afternoon of $88.62.

Ameristar Casinos ( ASCA) is sinking after Greff downgraded the stock to neutral from overweight. Currently, shares of the casino operator are up 20% for the year-to-date period, outpacing the S&P 500 by about 13 percentage points.

"We believe the move in shares thus far in 2010 is a reflection of Ameristar's strong free cash flow profile, an undemanding valuation, a sector-related move, investor belief that competition in the St. Louis market would have a negligible impact on Ameristar's St. Charles results and that regional gaming spending will eventually improve," Greff wrote in a note.

Still, Greff also believes there is potential for near-term margin pressure from its competitor River City, which is expected to ramp up its marketing.

Shares of Ameristar are falling 3% to $17.73 in morning trading.

Empire Resorts ( NYNY), meanwhile, is plunging 6.2% to $2.13, after it said that a court found it defaulted on $65 million in senior convertible notes issued to Bank of New York Mellon and The Depository Trust Company. The court ruled that Empire Resorts must now repurchase the senior convertible notes.

Regardless, when it comes to first-quarter earnings results, most analysts note that while the market is improving, investors should remain cautious about placing bets on casinos.

"Although we have seen strong returns in the first quarter, we still believe that it is prudent to remain patient and await a more attractive entry environment before adding to, or establishing, positions across a sector that relies on consumer discretionary dollars that are increasingly being spent in other areas during this rebound in confidence and spending," KeyBanc analyst Dennis Forst wrote in a note.

-- Reported by Jeanine Poggi in New York.

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