It has been a busy week for shareholders of casino operator Aztar (NYSE:AZR). On Monday, the company fielded a $2.4 billion buyout offer ($47 per share) from privately owned Columbia Entertainment. The fourth suitor to make a play for Aztar's coveted Las Vegas real estate, Columbia topped bids from Ameristar Casino (NASDAQ:ASCA) and real estate investment fund Colony Capital LLC. A day later, Pinnacle Entertainment (NYSE:PNK), the company that fired the opening shot in the bidding war last month, dug deeper and finally responded with a counteroffer of its own.

Thursday morning, investors are taking a break from the ongoing negotiations -- which have lifted Aztar's shares by more than 50% over the last few weeks -- to sift through the company's latest financial results. During the first quarter, revenues at Aztar's five properties edged up 2% to $228 million, while property-level EBITDA jumped by 17% to $62.6 million. However, earnings for the period sank sharply to $3.2 million, or $0.08 per share, largely because $26 million in development costs had to be written off.

After dragging its heels for years, Aztar was finally contemplating a $1.2 billion facelift for its aging Las Vegas Tropicana resort. But with a takeover in the works, those plans -- which called for a 2,700-room resort, featuring 100,000 square feet of gaming space and a four-acre rooftop recreation area -- have been tossed out the window, most likely in favor of something much more elaborate.

As competing companies line up for a chance to redevelop the resort (and the prized 34-acre parcel of land it now occupies), Aztar's other Tropicana-branded property in Atlantic City continues to do most of the heavy lifting. Since a $225 million renovation and expansion project was completed in late 2004, RevPAR (revenues per available room) there has been on the rise, and casino wins -- particularly those on the slot floor -- are consistently growing at one of the fastest rates in the Atlantic City market.

With revenue growth easily outpacing the additional operating expenses, EBITDA margins have expanded nicely in recent quarters. In fact, first-quarter margins rose nearly 800 basis points (with the aid of insurance proceeds) to 26.7%, pushing EBITDA at the Atlantic City property up almost 50% to $31.2 million -- or exactly half of Aztar's total. Those gains helped offset flat or declining bottom-line results at each of the firm's remaining properties.

However, at this point, any short-term operating improvements are merely icing on the cake for whichever company emerges on top in this fierce bidding war. Since colleague Jeff Hwang weighed the merits of riverboat operator AmeristarCasinos' (NASDAQ:ASCA) $42-per-share offer last week, things have continued to heat up -- which was largely expected, because the shares were trading for more than $44 following Ameristar's proposal.

Without getting into the specifics of this rapidly unfolding story -- that topic deserves an article of its own -- Pinnacle's latest gambit is curious. Wednesday, the company upped its offer by $5 to $43 per share. Clearly, management has indicated that it's not yet ready to fold its hand, but it's not willing to overpay to top Columbia's bid of $47, either.

It seems unlikely that Pinnacle would deliberately counter with a lower offer just for show, which leads me to believe that Aztar's board will take a long, hard look at the new bid. To be sure, there are other considerations besides the price tag, and it wouldn't be the first time a board accepted a lower offer. Furthermore, there are reportedly regulatory and funding issues connected with Columbia's bid.

In any case, all this attention underscores the tremendous long-term potential of the Las Vegas Strip.

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Fool contributor Nathan Slaughter will be visiting Las Vegas next month, but he owns none of the companies mentioned.