Las Vegas locals casino operator Station Casinos (NYSE:STN) saw its already high-flying stock jump another 12% yesterday -- closing the day at $68.92 -- after the company raised its first-quarter outlook. Not coincidentally, both rival Boyd Gaming (NYSE:BYD) and riverboat player Ameristar Casinos (NASDAQ:ASCA) -- the two casino operators whose competitive strategies most closely resemble Station's -- also saw their stocks rise 7% and 9%, respectively, to new all-time highs.

Station Casinos said Tuesday morning that it now expects adjusted earnings of $0.66 to $0.68 per share in the first quarter, up from its previous guidance of $0.56 to $0.62 per share, and ahead of the $0.60 per share analyst estimate. Meanwhile, the company upped its EBITDA expectation to between $117 million and $119 million, up from its previous estimate of $107 million to $113 million.

Station cited higher than expected same-store sales growth -- in the upper range of its previous guidance calling for growth of 9% to 13%.

As we've discussed in the past, the key to Station's success is its concentration in the Las Vegas market, a fast-growing locals market with little potential for competition. The company has dominated, with its large gaming facilities coupled with multi-faceted entertainment options, including movie theaters and a wide variety of dining options. A fantastic growth pace, and a dominant business combined with high barriers to entry in the Las Vegas market have helped Station's stock more than triple over the past two years.

And then there's the expansion story.

Station said that the upscale Green Valley Ranch property would see revenues climb 39% to 43% over last year's first quarter as a result of the recent $125 million expansion project at the property, and that property EBITDA would climb from $17.7 million last year to between $26 million and $27 million.

Based on that success, as well as the "favorable supply-demand dynamics in the Las Vegas locals market," Station announced that it will accelerate the construction of its phase 2 expansion at Red Rock -- another high-end property that isn't even expected to open until the end of the first quarter of 2006. Once the second phase is complete, by the end of 2006, the property will feature more than 2,800 slot machines and 850 hotel rooms, as well as a 16-screen movie theater complex.

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Fool contributor Jeff Hwang owns shares of Ameristar Casinos. The Fool has a disclosure policy.