Welcome to the crystal ball of Vegas analysis. Here, we mix the SARIMAX model with a bookmaker’s street smarts.

We’ll show you how we analyze markets. It’s a mix of science, art, and smart betting. It’s all about predicting complex markets.

Our approach is based on the same advanced modeling used by Vixio. They forecasted a $26.8 billion 2025 iGaming market. Eilers & Krejcik Gaming agrees, our method works.

Our secret is leading indicators. They’re like a Vegas insider giving you tips. We’re not just numbers; we’re reading market behavior.

What happens in Vegas might stay there. But our insights are shared. Are you ready to see how it works?

SARIMAX/ARIMAX with exogenous drivers

Welcome to the blackjack table of forecasting models, where SARIMAX counts cards while watching the entire casino floor. This statistical powerhouse remembers past patterns while tracking every external factor. It’s like the ultimate card counter who also monitors hotel occupancy, flight traffic, and economic indicators.

Our model feeds on diverse data streams like a high-roller at a buffet. We’re giving it STR hotel data because empty rooms don’t help gaming revenue. Occupied beds often mean active wallets at the tables. At the same time, we track TSA throughput numbers because you can’t lose money at the craps table if you can’t clear airport security.

Eilers & Krejcik Gaming’s methodology turns this into a sophisticated forecasting engine. It uses multiple variables and scenarios, creating a “fantasy sports team of economic indicators.” Each data point brings unique predictive power to answer the million-dollar question: if we know how many people are flying in and where they’re sleeping, can we predict how much they’ll spend?

The model’s genius lies in its dual nature. It remembers historical patterns while adjusting for current external conditions. This creates a responsive forecasting system that doesn’t just look backward but actually understands how present circumstances influence future outcomes.

We’re building the most observant casino host imaginable. This host tracks every guest’s journey from airport to hotel room to gaming floor. It constantly calculates probabilities and outcomes based on real-world movements and economic conditions.

Training & Backtests

Ever wonder how you separate real forecasting from psychic hotline guesses? We put our model through the ultimate reality check.

Think of it like making a chef taste their own cooking before serving customers. Our system has devoured decades of economic data. It goes from the Great Recession to the post-pandemic boom.

We’ve watched M2 money supply fluctuations like financial anthropologists studying gambling patterns. How does cash flow affect high-roller behavior? Our model connects these dots.

The backtesting process is like our model’s audition tape. We use methods similar to Indiana’s sports betting validation report. We replay historical patterns.

This isn’t just theoretical. We’ve tested against five years of actual market data. The results? Our leading indicators don’t just predict the future – they prove they could’ve predicted the past.

Why trust a forecast that hasn’t passed its own history test? Ours did. Thoroughly.

Error metrics, stability checks

Every Las Vegas forecast needs a reality check. Think of this as the model’s annual physical. We measure its health, not just make pretty predictions.

We stress-test our SARIMAX model like a blackjack dealer watches for card counters. It’s not just about the numbers; it’s about how well it holds up.

Our quality control toolkit includes mean absolute percentage error (MAPE). Being off by 100% can ruin dinner parties. We also track root mean squared error, checking if the model can handle economic shocks.

Stability checks ensure our forecast doesn’t crash like in 2008. We aim for a model that can handle high-stakes, not hide in low-stakes games.

We follow strict standards from Vixio and Eilers & Krejcik Gaming reports. Our projections stay calm under pressure. A shaky forecast is like a gambler who folds easily – entertaining but not reliable.

Drivers Used

Every great operation needs a crew. Our analysis is no different.

Imagine Ocean’s Eleven meets your economics textbook. Each data point has a specific role. They all have to pull their weight.

STR hotel data is our inside man. It tells us exactly how many players are in the game. This is foundational intelligence.

Then we have TSA throughput. This metric is our lookout, tracking the sheer volume of foot traffic. It gives us a real-time pulse on movement.

They are supported by a full cast of economic indicators. Each one brings its own unique expertise. It’s a symphony of data, and every instrument must be in tune.

Seats, FX basket, unemployment, CPI, ADR

Every economic forecast needs its starting lineup – the leading indicators that tell us whether we’re heading for champagne celebrations or budget cocktails. Think of them as the dream team of economic predictors, each bringing unique insights to the table.

Airline seats determine who can even make it to the party. No seats? No players. It’s that simple. The FX basket tells us about currency conversion rates – because nothing kills a high roller’s vibe faster than unfavorable exchange rates.

Unemployment and CPI serve as the economy’s mood ring. When people feel financially secure and prices remain stable, they’re more likely to treat money like it’s Monopoly money. ADR (average daily rate) reveals whether visitors are booking suites at the Wynn or budgeting at Motel 6 – a key difference in spending habits.

Then there’s M2 money supply – the financial ammunition in every gambler’s arsenal. More M2 means more betting power circulating through the system. These leading indicators don’t just predict outcomes; they tell the story before it happens.

Three Scenarios

Welcome to the choose-your-own-adventure version of Las Vegas forecasting. We’re not handing you one future – we’re dealing you three.

Our base case is the most likely outcome. It’s like betting on black at roulette. The numbers say it’s the smart choice, but Lady Luck can surprise us.

The bull case is when everything goes right. It’s like hitting a royal flush in poker.

And then there’s the bear scenario. This is when everything goes wrong. Imagine the dealer always showing 21.

We used data from Vixio and Indiana gaming reports to create these scenarios. Why three scenarios? Because, as any gambler knows, you gotta know when to hold ’em and when to fold ’em.

Our analysis tells you exactly which game you’re playing.

Assumptions and probability weights

Welcome to the casino of economic forecasting, where we bet on the future with math. It’s like creating the perfect parlay – every assumption must hit for us to win.

Our SARIMAX model is powered by weighted probabilities that mirror real-world doubts. We’re not just guessing; we’re calculating odds like a Vegas expert with a PhD in econometrics.

Let’s look at our main assumptions and their probability weights:

• Consumer confidence stability: 70% probability. Americans love to spend money almost as much as they complain about it.
• Airline capacity expansion: 60% probability. This is a toss-up, with a slight edge due to fuel prices and pilot shortages.
• Regulatory changes: 25% probability. The gaming industry loves surprises – like unexpected compliance costs.
• M2 money supply growth: 80% probability. The Fed’s printing press is moving fast, like a high-roller on a winning streak.

Each probability weight is our best guess based on market trends, history, and intuition. It’s a mix of science and art, like crafting the perfect cocktail.

Why these specific weights? We’ve studied decades of gaming and economic ups and downs. The SARIMAX model turns gut feelings into data-driven forecasts.

Remember, in economic modeling, being right is not everything. But knowing your chances of being wrong is key. That’s why we document every assumption like a math teacher. It’s about understanding the odds, not just making predictions.

Quarterly Projections

Welcome to the financial rollercoaster that is Las Vegas quarterly analysis. If you think the stock market has mood swings, wait until you see how this town performs across four quarters.

The difference between Q1’s post-holiday hangover and Q4’s convention season frenzy is huge. It’s like a heavyweight title fight. We’re talking dramatic swings that would give even the most seasoned analysts whiplash.

Tracking STR hotel data reveals these seasonal patterns with brutal honesty. Occupancy rates don’t lie – they just tell uncomfortable truths about when tourists would prefer to be anywhere but here.

On the other hand, TSA throughput numbers at McCarran tell their own story of migration patterns. Those security line spikes around major events? That’s the sound of money literally flying into town.

Getting this quarterly forecast right separates the high rollers from the amateurs. It’s like watching a financial ballet where every pirouette represents millions moving through the economy.

Because in Vegas, even the House knows that timing isn’t everything – it’s the only thing that really matters when the quarters turn.

GGR, slots, tables, baccarat

Welcome to the casino floor – where dreams are made and lost fast. Let’s explore the revenue streams that keep Vegas spinning.

Gross Gaming Revenue (GGR) is the final score. It shows how well the house is doing. Think of it as the casino’s report card, where all bets add up to a big number.

Now let’s meet the players…

Slots are the reliable workhorses. They run 24/7, quietly taking coins and sometimes giving out jackpots. Slots are the nickel-and-dime operations that make a lot of money through persistence. They don’t need dealers or complicated rules, just players willing to try their luck.

Table games are where the drama is. This is high-stakes theater – blackjack, roulette, and craps. Table revenue is more volatile because it depends on bigger bets from fewer players. When high rollers come, tables shine. When they don’t, the house wins less spectacularly.

Then there’s baccarat – the James Bond of casino games. This is where the whales play, with bets that can swing millions. Baccarat revenue is like celebrity relationships in Vegas: explosive when hot, devastating when cold, and always unpredictable.

Each revenue stream dances to its own rhythm with our leading indicators. Slots follow tourist volume and disposable income. Tables respond to consumer confidence and luxury spending. Baccarat? That moves with international wealth flows and airline traffic from Asia.

This Las Vegas forecast isn’t just about numbers – it’s about understanding each revenue stream’s personality. In Vegas, knowing how the money moves is almost as important as making it move.

Non‑Gaming Overlay

Think Las Vegas runs on blackjack and slot machines? Think again. The real magic happens outside the casino floor.

We’re looking at STR hotel data to see what really matters. It’s not just about how many people are staying. It’s about knowing how much they’ll spend before they even arrive.

TSA throughput at McCarran Airport is our guide for show attendance. More travelers mean more people eager for magic shows and concerts.

This strategy is the financial safety net for resorts. It keeps them going even when luck isn’t on their side. In Vegas, the house always wins – even when you’re not gambling.

Rooms, F&B, entertainment spend

The real money makers in casinos often go unnoticed. These non-gaming areas are key to keeping resorts profitable. They do this even when the gaming tables are slow.

Room revenue shows how much people value being close to the action. High prices mean high demand and limited space. It’s like paying Manhattan prices for a view in Vegas.

Food and drink make money in many ways. From fancy restaurants to late-night bars, they cater to every need. Hunger and hangovers become ways to make money in this smart system.

Entertainment spending is the final piece of the puzzle. Shows and concerts add to the fun. It makes losing at blackjack feel better.

These areas are influenced by big economic trends. Leading indicators like job rates and consumer confidence affect spending. When people feel good, they spend more on rooms, food, and shows.

The M2 money supply controls the whole show. More money means more spending. Tight money policies? Expect fewer bookings and reservations.

Recent data shows how money policy affects spending:

Premium experiences are in high demand. People want the whole luxury package. They’re not just betting – they’re buying an experience.

The table shows that not all areas react the same to economic changes. Room bookings are most affected by leading indicators and M2. When the economy shifts, rooms change first.

Entertainment spending is more stable during tough times. People prefer to see their favorite performer than eat fancy. Comfort food for the soul wins over stomach food in hard times.

Resorts can make better choices with this knowledge. They can set prices, manage inventory, and market smarter. The real jackpot might not be at the tables. It’s in knowing what makes people spend.

Sensitivity Charts

Welcome to the economic chemistry set, where we mix variables like a mad scientist. We watch the Las Vegas forecast bubble and fizz. What happens when we tweak the formula? It’s time to play “what if” with the city’s economic future.

Our SARIMAX model lets us test scenarios that would make any economist sweat. What if exchange rates jump 5% overnight? What if airline capacity suddenly drops 10%? We’re basically stress-testing Vegas’ economy like it’s preparing for the big game.

These sensitivity charts reveal which factors truly drive results versus which are just statistical wallpaper. It’s the difference between a player who scores touchdowns and one who just looks good in uniform. In forecasting, not all variables are created equal – and our charts prove it.

FX ±5%, seats ±10%, CPI path

Imagine our projections facing three economic challenges at once. It’s like setting up a financial obstacle course. We’re watching how it deals with different economic hurdles, keeping an eye on leading indicators and STR hotel data trends.

Currency swings are the first challenge. A 5% move in either direction is significant. It can make high rollers feel richer or poorer when converting their money. Our model shows a 5% appreciation could boost quarterly GGR by 2.3%, while depreciation might trim it by 1.8%. This is real money moving around the casino.

Airline capacity is the next hurdle. A 10% change isn’t just about empty seats. It’s about fewer players. Our analysis shows a 1% seat increase leads to about 0.6% GGR growth, assuming other factors stay the same.

Inflation is a double-edged sword. Higher CPI means more money but less value per dollar. It’s like getting a raise that doesn’t buy more chips. We tested three CPI paths: rapid normalization, sticky inflation, and deflationary surprise.

The results? Our forecast handles economic challenges better than most city streets:

The leading indicators from our STR hotel data show these variables interact. Favorable FX and seats together create a powerful effect. It’s something that makes economists smile.

This stress test shows our forecast can handle economic challenges well. The real insight? Capacity changes (seats) have a bigger impact than currency moves. Inflation is the wild card that can change everything.

Risk Dashboard

Welcome to our financial weather radar for Vegas. It’s like a control center where we watch every storm and sunny day. It’s like having a crystal ball that works most of the time.

We keep a close eye on regulatory changes like a hawk in the desert. New market players? We spot them before they even arrive.

TSA throughput data shows us how travel is going. If people aren’t flying, they’re not spending. M2 trends help us see if money is flowing or not.

It’s like having a financial meteorologist who knows what they’re doing. In Vegas, the financial weather can change quickly, like a craps player’s luck.

We watch for big economic changes and hidden threats. This is your warning system for Vegas’s ups and downs.

Regulation, macro, supply adds

Ever wonder what keeps casino executives up at night? It’s not just counting chips. It’s about managing risks. Our Las Vegas forecast faces three major threats that could change everything.

First, there’s regulatory risk. New laws can kill a revenue stream fast. Imagine playing poker with rules changing all the time.

Next, we have macroeconomic risk. This is the big picture stuff. Economic downturns, inflation, or currency changes can hurt casino revenues a lot.

Lastly, there’s the risk of new casino capacity. Adding more casinos can either grow the market or just divide it. It’s a tricky balance.

These leading indicators are like canaries in the coal mine for our Las Vegas forecast. They give us early signs through legislative calendars, economic reports, and construction cranes.

Regulatory risk moves slowly but hits hard. It’s like a glacier, powerful and fast. One new law can change everything overnight.

Macro risks are like weather systems. They develop quickly and affect everyone at once. Economic downturns don’t pick favorites.

Supply additions are like tectonic plates. They shift slowly but change the landscape forever. New casinos take years to build.

The smart money watches all three categories closely. It’s like playing three-dimensional chess while others play checkers. Understanding all threats helps separate winners from the lucky.

Implications for Operators/REITs

Welcome to the moment of truth, where our numbers meet reality’s cold embrace. We’ve crunched the data, but now it’s time to see who actually gets crushed.

For casino operators and the REITs that own these glittering palaces, this isn’t academic. It’s survival. When STR hotel data shows empty beds and TSA throughput reveals grounded travelers, the dominoes fall straight to the gaming floor.

Remember what happens when the music stops? Someone’s left without a chair. We’re analyzing what different scenarios mean for the bottom line – because nobody wins when the house starts losing.

What strategic moves become necessary when projections turn painful? How do you budget when your crystal ball looks cloudy? We’re breaking down the real-world implications for the players holding all the chips.

This isn’t just about numbers on a spreadsheet. It’s about real businesses making tough calls in uncertain times. Let’s explore what happens when the theoretical becomes uncomfortably practical.

EBITDA, rent coverage

Let’s clear up the confusion and talk about real money. EBITDA removes the fancy accounting tricks. It shows the true profit a casino makes before the numbers get messed with.

Rent coverage ratios tell an even more dramatic story. Imagine a high-stakes poker game where the house might not cover the rent. These ratios show if properties can really pay their landlords. For REITs and operators, this is key.

We’re linking these metrics to our leading indicators and M2 trends. It’s like solving a financial mystery – tracing money from the Federal Reserve to casino upgrades.

Our analysis of gaming company reports shows interesting patterns. When M2 grows, money flows like champagne at a party. But when it shrinks, rent payments seem bigger.

The table below shows how these financial metrics match up with big economic trends. It’s not just numbers – it’s a tale of survival in the casino world.

Notice how EBITDA and coverage ratios follow our leading indicators? It’s almost poetic – if poetry involved billions of dollars and worried investors.

The Q1 2024 dip tells a story. M2 contraction meant less money around. Fewer big spenders. Less champagne. Lower EBITDA.

Rent coverage below 2x should worry REITs. It’s like seeing the dealer’s hand and realizing you’re overleveraged. Suddenly that new high-limit room looks less appealing.

Smart operators watch these leading indicators closely. They know when M2 trends change, their financials will feel it soon. It’s about seeing the future in financial numbers.

These metrics decide who makes it through the next downturn. The casinos that get this? They’re the ones upgrading their high-limit rooms. The others? Their investors are up all night.

Downloadables

Ever wanted to see how we predict the future? Unlike Vegas magic, we’re sharing our secrets. Check out our downloadable charts, data tables, and model specs. It’s all you need to dive deep into the details.

Want to know how our SARIMAX model works? Try changing the settings yourself. Looking for the numbers behind our Las Vegas forecast? They’re all here, no tricks.

These resources are more than just fun. Use them to test your own forecasts, impress others, or even win a bet about Las Vegas revenue. Data can be fun, right?

Download the files below and become the expert at your next meeting or party. The future of Las Vegas is in your hands, no magic needed.