Once fabulous, now struggling to recover. Photo: Edited from Wikicommons

While Las Vegas still brings plenty of tourists, the economy in Las Vegas is still far from recovered. For casino investors looking at companies like Caesars Entertainment (NASDAQ:CZR) and Boyd Gaming Corp. (NYSE:BYD) dependent on U.S. operations, this is not good. However Las Vegas Sands (NYSE:LVS) is not struggling.

Struggling to get back
It used to be all glitter and glam for Las Vegas and Nevada's residents. While many locals initially protested the casino mecca, Nevada's residents happily spent more than a decade with high state tax revenue, low unemployment, and rising wages thanks to the gaming economy. Then, following the financial crisis of 2008, everything seemed to change. Now, Nevada's unemployment remains the second highest in the nation at nearly 9%.

Casinos were a huge employment driver around Las Vegas, but cut backs and lay-offs have helped to cause Nevada's high unemployment. Photo: Casino.org

Nevada itself has casinos to thank for its economic success up to this point. The state ranks 45th in the nation for education, though that hasn't stopped it from enjoying a median level of average income in the years up to 2008 thanks to gaming revenue. Without much else to fall back on, the economy looks grim if gaming doesn't pick up in the region.

The economy in Las Vegas has struggled to climb from the depths of the 2008 financial crisis. "I can tell you right now Nevada is nowhere close to a normal economy," one Nevada senator put it. Even Federal Reserve chair Janet Yellen acknowledged that a full recovery remained years away. Why is this?

Las Vegas casinos made $37.34 billion in revenue from their customers in 2012, just under the $37.52 billion they made in 2007, Las Vegas's peak year before the crash with record revenue for Caesars, Boyd, and Las Vegas Sands. And now, even with revenues close to 2007 highs, retaining these players has become more expensive and profits are still down by as much as 50% as in the case of Caesars. Yet Las Vegas Sands continues to post record income.

Caesar's CEO Gary Loveman has tried in vain for an international presence, and now seeks to lower the company's huge debt load. Photo: ReviewJournal

Caesars and Boyd: Both struggle, one seeks a way out
Both Caesars Entertainment and Boyd Gaming posted terrible earnings last quarter. Caesars posted revenue down over 8% compared to the first quarter of 2013, which caused the company's total income to drop by over 50%. Meanwhile, Boyd Gaming posted first-quarter revenue down nearly 4% and EBITDA down over 11.6% year-over-year. These numbers were pretty tough for investors focused on U.S. gaming to swallow, but for Boyd, at least, a highlight might exist.

While Caesars continues to bounce around between trying in vain to establish an international presence and paying down its industry-leading debt load, Boyd Gaming at least has some saving graces. The company has started to push its online presence and now offers live online gambling that is becoming a sizable facet of its business. Along with its partnership with PartyPoker, Boyd Gaming Corp. is already the market leader in online gambling in New Jersey, where it has used in-house and online championships to bring more visitors to its locations and online operations.

Photo: The Borgata

New Jersey is a special case as the local government has been lenient on online gambling, but not all states allow it. However, more and more states are legalizing it. If Boyd can replicate its operations at Borgata in other parts of the country, this could potentially create a new revenue driver for the company. Still, until that happens, Boyd Gaming is definitely struggling along with the Las Vegas economy. 

The company that is NOT struggling: Las Vegas Sands
Las Vegas Sands is no exception to the trend of lower U.S. revenue, and its Vegas operations also performed poorly in the first quarter. However this is not an issue for Sands' bottom line, or its share price. Why? Because of the company's bet on Asia.

Las Vegas Sands got 88% of its revenue from Asian operations in Q1.

These gains from Asia are what helped the company report net revenue during the first quarter of 2014 of a record $4.01 billion, up over 21% from the first quarter of 2013. Its Macau operations in particular did better than ever with nearly 50% EBITDA growth.

A bill sits waiting to be heard that will legalize gaming in Japan. If the bill passes, Japan could become the second-largest gaming market in the world at $40 billion per year by 2020. Las Vegas Sands is a top contender in the bidding to build in Japan. Sands is also seeking a bid in South Korea, at the site of the 1988 Olympic games in Seoul. Those two Asian expansions will bring new revenue and diversification to Sands, but before either of those happens, Sands will complete its newest megaresort in Macau in 2015, which will surely bring huge gains in the next few years.

Foolish takeaway: A bet on Las Vegas Companies should not be a bet on Las Vegas
Las Vegas was once the place to be in the gaming world, and for some, it still is. It might still recover and become that again. However, waiting for that may not be a good bet for your portfolio. For a company like Caesars Entertainment that only operates in the U.S., this is a dangerous waiting game. For Boyd Gaming Corp., it's much the same, though at least the company is seeking to diversify with online gaming.

However, for investors who seek stronger returns, Las Vegas Sands is clearly a company which has placed itself where the money is, and will continue to do so with Macau, Japan, and South Korea. Sands has not forsaken Vegas, and if the city recovers to its peak, Sands will be there. But in the meantime, the company continues to post record revenue growth while U.S.-only companies are posting quarter after quarter of losses.