Profits are down. The casinos are still making money, so there's room for more. Besides, customers often like to go to the newest and biggest casinos, so a stale building can be a turn-off. Casinos always need to upgrade their facilities, and sometimes it is more economical to build anew. Personally, I think they overdo it - will the Detroit casinos really fill all those $350/nt rooms at anywhere near rack rates? Are there enough "high rollers" to keep captive? I hope for success, but my investment in the gaming industry will - for the time being - be limited to a chip at a time.

I am most fascinated by the following quote, though:
"Why the city of Atlantic City thinks it needs a smoking ban at this time is incomprehensible to us," Deutsche Bank's Zarnett said.
I'm not sure the analyst fully understands that smoking bans are not implemented for financial reasons. They are instead implemented for health reasons. They may have a negative economic impact (although I prefer smoke-free gaming floors), and that effect may be heightened when profits are declining, but is it really "incomprehensible" to a college-trained analyst? C'mon!