NEW YORK ( TheStreet) -- Boyd Gaming ( BYD) shares plunged Tuesday on disappointing sentiment coming out of Las Vegas.

An analyst at Janney Capital Markets, Brian McGill, downgraded the casino operator to sell from neutral on Tuesday; he believes the Las Vegas market will take longer than expected to recover.

Though investors seem to sense that Las Vegas's off-strip casinos will see business return to 2004-2007 levels "at some point," the bearish McGill doesn't think so, he wrote in a note to clients.

"After looking at various population, employment, type of employment and housing numbers, we have concluded that revenues are likely to stay at a depressed level for quite some time going forward," the analyst wrote.

Things aren't looking much better on the other side of the continent. The implementation of table games in Pennsylvania could put pressure on Boyd's Borgata casino in Atlantic City, and the eventual addition of slots at New York's Aqueduct could also cut off some traffic to the New Jersey gaming center.

Shares of Boyd finished trading Tuesday at $11.89, down $1.28, or 9.7%.

The only two positive catalysts for Boyd, according to McGill, are if the company gains MGM Mirage's ( MGM) half of the Borgata casino and/or Station Casino's assets.

Other regional gaming outfits also fell on the analyst's Las Vegas outlook. Isle of Capri Casinos ( ISLE) declined 6.7% to $9.29 and Ameristar Casinos ( ASCA) lost 2.2% to $17.62.

But while Las Vegas remains a gamble, Macau continues to look like a sure-fire bet. In May, gaming revenue generated by the Chinese gambling enclave nearly doubled, coming in somewhere between $2.13 billion and $2.25 billion, the region's steepest year-over-year gain on record.

The month received a boost from the opening of the Wynn ( WYNN) Encore, which took its first bet at the end of April; easier year-over-year comparisons; and the loosening of visa restrictions, JPMorgan analyst Joseph Greff wrote in a note.

Optimism over Macau and Singapore led McGill to upgrade Las Vegas Sands ( LVS) to buy from neutral.

McGill estimates that the Macau market will most likely take in more revenue in the second quarter than the Las Vegas Strip did in all of 2009.

The buoyant note from JPMorgan couldn't stop shares of Las Vegas Sands from sliding along with the rest of the sector. The stock finished trading Tuesday at $23.02, down 2%, while Wynn Resorts slid 2.8% to $82.53.

One of the only casinos in the green was Macau-based Melco Crown Entertainment ( MPEL), shares of which rose 3.3% to $4.43. Melco is the only pure-play Macau stock in the U.S.-listed casino sector.

Reported by Jeanine Poggi in New York.

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