Casinos remain shielded from Japan quake

Those companies operating in Macau and Singapore (Melco Crown Entertainment, MGM Resorts, Las Vegas Sands and Wynn Resorts) all saw shares opening lower on Tuesday, as investors fear the earthquake will affect visits to these markets.

As it relates to Macau, 1.7% of visitation to the market comes from Japan, according to Santarelli. "Given our belief that the majority of the Japan gaming business is VIP play, we would expect any impact to be isolated to the VIP segment of the market."

But even if there is a long-term disruption to Japanese visitation, it will not have a meaningful impact on gross gaming revenue of operator fundamentals, Santarelli predicts. Singapore volumes from Japan are meaningfully higher, at about 5.1% of the total market. Nonetheless, Santarelli still doesn't see a significant impact to gaming operations.

Las Vegas Sands opened its flagship casino in the region last April, and thus far has seen impressive results from the market. The biggest issue related to gaming is how it will impact the process for legalizing gaming in Japan.

In 2009, Italy turned to gaming expansion rather quickly following its earthquake. "While we do not care to speculate how these events will impact the process in Japan, we do believe investors may come to the conclusion that the need to raise funds for Japan will have more urgency post these tragic events," Santarelli wrote.