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Credit Suisse Upgrades Three Casino Operators

Aztar Corp., Boyd Gaming Corp. and Argosy Gaming Corp. were upgraded to reflect the view that recent corrections in profit growth and valuations are more than was justified by potential declines resulting from an upcoming tax hike on riverboat casinos in Illinois, the investment firm said.

The Illinois Legislature over the weekend passed a bill to increase taxes on casino revenues to as high as 50 percent, a move that is expected to hit hardest for riverboat operator Argosy.

Aztar does not have properties in Illinois but could be hurt by similar gaming tax legislation under discussion in Indiana, where it operates a casino in Evansville, analysts said. Credit Suisse is reducing a price objective on Aztar shares from $27 to $25.

The firm reduced targets on Boyd shares from $17 to $16 and on Argosy shares from $42 to $36. The percentage reductions in stock price targets approximate decreases in the firm's 2003 earnings per share projections for the two companies, analysts said.

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