Macau ended 2016 with a fifth straight winning month. But the global casino capital’s gaming revenue finished lower for the third straight year, stock prices took a hit and different analysts present contrasting snapshots of the market. That’s surely not what the authorities mean when they talk about diversification, but in 2016 Macau began to show real signs of developing into the tourism and leisure destination that Beijing wants it to become. Whether that business model can return Macau’s revenue to where it was in the era of massive VIP betting volumes is the next challenge. Late 2016 has gotten things moving in that direction.

In December, Macau’s gross gaming revenue (GGR) rose to 19.8 billion Macau patacas (MOP; US$2.48 billion), up 8% from a year earlier, and 5.5% from November. For the year, GGR fell 3.3% to MOP223 billion (US$27.9 billion). Fourth quarter revenue rose 10% year on year and from the third quarter.

There seems to have been no revenue impact from an early December Macau government directive limiting UnionPay withdrawals to HK$5,000 (US$645) per transaction while the daily withdrawal limit remained unchanged at RMB10,000 (US$1,445), roughly equivalent to HK$10,000, so users can get the same amount of money but need to swipe twice. That inexplicable adjustment provoked an understandable if unjustified 13% drop in casino operator share prices in December.

That quirk aside, there’s nearly universal agreement that Macau is in a genuine recovery. “With the benefit of hindsight, June’s daily average of MOP529 million appears to have been the low water mark of the multi-year downturn,” Union Gaming Head of Asia Equity Analysis Grant Govertsen writes. “December’s average [daily revenue] of 639 million represents 21% growth relative to June,” and, excluding the October holiday month, has grown sequentially in each month, the Macau based analyst adds. “This growth in GGR actually exceeded the growth rates in supply over the same period as it relates to hotel rooms (+15% when comparing December 2016 to June 2016), table games (+6%) and slot machines (+8%). With more modest increases in supply in 2017 we remain upbeat about the growth prospects next year.”

Morgan Stanley leads that growth consensus for this year with an estimate of 10% casino revenue growth, raised last month from 2%. Buckingham Research Group forecasts 6-8% GGR growth in 2017, Sanford Bernstein projects 8%. I expect gaming revenue growth in line with mainland China’s GDP growth, with faster growth in non-gaming.

Wells Fargo Senior Analyst Cameron McKnight remains a dissenter. “In our view, recent stabilization and some market growth has been driven by Chinese monetary stimulus and the re-inflation of the Chinese housing bubble – influences we think won’t drive prolonged, above-trend growth,” he writes, noting that December’s 5.5% growth over November fell below the five year trailing average of 6.9%.

While others see the market in sustainable rebound, they paint the market in a variety of shapes. J.P. Morgan Regional Analysts DS Kim and Sean Zhuang estimate December mass revenue was up 10% from a year ago and VIP revenue grew 5-7%, less than half their estimate of VIP growth in November and below their expectation, a situation to “closely monitor” for a possible trend. Buckingham Research Group Gaming and Lodging Analyst Christopher Jones estimates mass market grew 12-13% in December and VIP was flat or down 1%. Noting flat visitor numbers, he sees higher per capita spending and longer stays driving growth.

Sanford Bernstein contends VIP revenue rose in December, but Senior Analyst Vitaly Umansky notes that volatility in reported average daily revenue numbers, gathered from casino operator sources along with VIP/mass split data, call into question the reliability of those unofficial numbers and monthly operator market share estimates. Later this month, the government will issue its quarterly figures, including its VIP revenue count. Until then, the VIP/mass picture remains murky.

Welcome to another – as the Chinese curse puts it – interesting year in Macau.