Las Vegas (LVS) Sands has been in the doghouse for some time now, and by the looks of it, there’s no end in sight. On the year in 2014, the casino stock was down 28.07%, all but guaranteeing it a place on Santa’s Shit List at the end of the year. In 2015 so far, the bearishness is a little milder, seeing a 1.58% decline over the first couple of months. But with the way things look right now, it seems that Las Vegas Sands still has yet to reach the basement.

The Power of the Chinese Government

One of the risks of doing business in China is the overwhelming power of its government. For example, there are a slew of articles surrounding the country’sInternet censorship problems. Last year, casino stocks first started seeing the consequences of that power.

Gambling in Macau has been the absolute powerhouse for casino companies like Las Vegas Sands. In 2013, casino revenues hit $45.2 billion compared to Las Vegas revenues of $6.5 billion. Then in 2014, Chinese president, Xi Jinping, launched an anti-corruption initiative, specifically pinpointing VIP gamblers funneling in from the mainland. The result? We saw the first decline in gambling revenue for the area since it was opened in 2002. All casino stocks are severely underperforming the market as a whole. For Las Vegas Sands, it doesn’t help that it derives almost 80% of its revenues from Macau.

The Next Blow

Now that the Chinese government has already permanently wounded the casino industry, it took another blow in February as the regions government is considering implementing a limit on the number of tourists allowed from the mainland. According to The Street, “Last year individual visa schemes made up 45% of the total Chinese visitors to the district, Nomura Securities said, Barron's noted. Group visas accounted for another 45%.”

Time to Look Elsewhere

At this point, there’s no end in sight to the mess in Macau, and there’s no reason why investors should trust the Chinese government to change its course on the issue. That being said, Las Vegas Sands needs to look elsewhere to prop up its revenue. Singapore should be the focal point, seeing how operating income for Marina Bay Sands grew an astounding 157.9% during the fourth quarter.

South Korea is another big opportunity as the country is planning to approve two more casinos this year. The only problem is that they likely won’t be open to local gamblers, something CEO Sheldon Adelson is pushing for, promising the country’s government a $4.5 billion casino complex in Busan. Japan is currently off the table as lawmakers have pushed off the decision whether or not to legalize gambling. However, that option is still open as Prime Minister Shinzo Abe is keen on getting it passed as a way to help return Japan to a sustainable economy.

Conclusion

Expect to see Las Vegas Sands continue to sputter throughout 2015. The trouble in Macau is more likely to get worse than it is to get better. Beyond Singapore, it’s going to take time to build up opportunities elsewhere. That being said, once the company can diversify away from Macau, we should see Las Vegas Sands return to its former glory.