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Wall Street is stacking its chips on the table for Isle of Capri Casinos Inc. (ISLE).

Comprehensive cost-cutting measures and being outside the troubled Las Vegas and Atlantic City markets is making Isle of Capri a safer bet among investors despite continued revenue loss at its casinos. The regional gambling operator, based in St. Louis, Mo., is sporting the best returns among its peers, with its share price more than tripling since the beginning of the year.

"Although there is broad pressure on consumer spending, smaller regional markets have held up better than Las Vegas and Atlantic City during the recession," said Michael Paladino, senior director of gaming at Fitch Ratings.

Missouri recently eased gaming regulations, which helped Isle's relative property performance compared with some of the larger gaming companies with greater exposure to Las Vegas and Atlantic City, Paladino said. In general, regional casinos in America's heartland have stabilized because they aren't as vulnerable to weakness in nongaming areas such as lodging, fine dining and air travel.

MGM Mirage (MGM) and Las Vegas Sands Corp. (LVS) had been dogged by concerns surrounding liquidity as well as a brutal business environment in Sin City which is battling rising unemployment and home foreclosures. Amid signs of industry stabilization and the removal of bankruptcy fears, MGM Mirage is up 260% from its 52-week low of $1.81. However, the company's share price is still down about 52% from the beginning of the year.

Meanwhile, Las Vegas Sands is up roughly 36% on the year to about $8.

Keith Foley, a gaming analyst at Moody's Investors Service, said while investors are getting more bullish because the pace of declines has slowed, Isle of Capri is still grappling with "declines on a revenue basis with few exceptions across the board," at the casino properties.

"The top line is still struggling," he said. Foley noted, however, that the management team has made extensive strides at controlling costs. "It's still hard to say that (demand) trends have stabilized across the U.S."

Isle of Capri, which owns 17 properties, announced last week that it swung to a fiscal fourth-quarter profit on a $57.7 million gain from the early extinguishment of debt. It was the company's second straight quarter of profit after more than two years of losses - a $95.2 million Hurricane Katrina insurance claim inflated its fiscal third-quarter results.

The debt-laden casino operator has been cutting costs and consolidating its portfolio into two brands as it concentrates on the U.S. The company has left the U.K. market and plans to stop operating its property in the Bahamas, where a sharp decline in tourism in late May shuttered a Four Seasons Hotels and Resorts BV property.

"We still see a tremendous amount of pressure across the company, as far as our retail revenue is concerned. Our database customers are basically coming about the same as they used to, but we're seeing that they're spending a little bit less," said Virginia McDowell, president and chief operating officer of Isle of Capri during the earnings call last week.

"We expect those trends to continue," she said.

Fitch's Paladino said the company has made strong efforts to improve their financial position, which has improved sentiment on the company.

They have "one of the top cost-focused management teams in the industry," he said. "Their overall credit profile is pretty attractive."

Paladino also said Isle has no debt maturities until 2012 and very minimal capital spending plans beyond maintenance.

-By A.D. Pruitt, Dow Jones Newswires, 212-416-2197, angela.pruitt@dowjones.com