Investors wondering if it's time to cash out investments in Macau might be best advised to take their chips off the table, analysts told CNBC.
After years of explosive growth, the world's largest gambling destination has fallen upon tough times, with revenue growth stalling, labor costs rising and share prices falling.
The gambling hub's mass market revenue growth slowed to 16 percent on-year in July, compared with June's 24 percent rise. Meanwhile revenue growth in the VIP high roller sector - which accounts for over 70 percent of Macau revenue - dipped to 13 percent on-year in July versus 17 percent in June.
"Is the boom starting to fade? There are concerns that it may be," said Uwe Parpart, chief strategist and head of research at Reorient Group.
Parpart highlighted a number of headwinds including the impacts of China's ongoing anti-corruption drive and the consequential crackdown on junkets - also known as VIP room promoters - who provide high-rolling players with credit at the casinos.
A total of 63,000 officials have been disciplined this year along, a 34 percent increase on 2013, according to Chinese media reports, and it's believed this had a direct impact on gambling appetite.
"There is also a feeling that saturation may have been reached, combined with the growing attraction of other Asian casinos. Macau's glitzy charms are being duplicated in casinos in Malaysia, the Philippines and Singapore in particular," added Parpart.
Also adding to the pain are visa restrictions implemented at the start of July restricting the length of tourists' stay and a slow recovery after the World Cup, which took some gambling business away from casinos.
Grant Govertsen, partner and global analyst at Union Gaming Research Macau, also sounded a bearish note on the region.
"We think the headwinds are going to be there for a long time, likely to the end of the year, potentially through to early next year, primarily driven by a weaker than normal VIP segment," he said. "We're recommending investors stay on the sidelines. There could be more downside."
Earlier this month gaming analysts at Japanese investment bank Nomura downgraded their fiscal 2014 growth expectations for Macau to mid-single digit percentage growth from 8 percent.
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"We have been saying the group could trade range-bound through Q3 given the lack of positive catalysts, and we now expect that to remain through year-end," said Louise Cheung, research analyst at Nomura, referring to Macau's six licensed casino operators: Wynn Macau (Hong Kong Stock Exchange: 1128-HK), Sands China (Hong Kong Stock Exchange: 1928-HK), Galaxy Entertainment (Hong Kong Stock Exchange: 27-HK), SJM Holdings (Hong Kong Stock Exchange: 27-HK), MGM China Holdings (Hong Kong Stock Exchange: 2282-HK) and Melco Crown Entertainment (Hong Kong Stock Exchange: 2282-HK).
But not all analysts are pessimistic on Macau's prospects.
"Let's be clear the Macau business and gambling sector is not going away, the Chinese have been gambling for thousands of years," John Oh, research analyst for gaming and lodging sectors at CLSA told CNBC Asia's "Rundown" on Friday.
"We've seen a slowdown in VIP and we know what's causing that. We think it's the anti-corruption measures in China," he added.
Oh told CNBC casino operators need to shift their resources away from VIP to the mass market, which is where future profits lie.
"If you look at mass market year to date, we're talking about a sector that's growing north of 32 percent. That's a healthy number. Casino operators are going to have to think about how to shift resources from VIP into mass market because mass market is simply four times as profitable as VIP," he said, adding that Las Vegas casinos' profitability is by contrast nowhere near that of Macau's.