Key Takeaways

  • Aaron Cowen, a seasoned hedge fund manager, argues MGM Resorts stock holds unpriced value in two “hidden assets”: a license for a major casino in Osaka, Japan, and a strategically located property in Dubai.
  • The Osaka, Japan casino opportunity alone is projected by Cowen to be worth about $50 per share, which he believes could more than double the company’s current stock value.
  • MGM’s 300,000 square foot property in Dubai serves as a “free option.” If gambling legalizes there, Cowen estimates this single asset could add another $40 to $50 per share.
  • Barry Diller’s recent aggressive stock acquisitions, bringing his stake to 26%, establish a strong floor for the stock and signal deep insider conviction.
  • Cowen's math is simple: Vegas assets ($60), Japan ($50), and a potential Dubai ($40-$50) combine for a potential triple in value, suggesting the market starts to price these opportunities about three years before they open.

The Hidden Map to a Triple

Hedge fund manager Aaron Cowen pitched MGM Resorts not on its Vegas glitz, but on two under-the-radar assets he believes the market hasn't fully appreciated. He sees a straightforward path for the stock to triple its current value, a claim that hinges on opportunities far from the Strip. Cowen zeroes in on a license MGM holds to open a massive casino in Osaka, Japan. He states this Japanese venture alone could “more than double the stock,” estimating its value at about $50 per share. It's a significant play, a new frontier for a company largely defined by its American presence.

But the real kicker, according to Cowen, is a property MGM has in Dubai. He calls this their "free option." Gambling is illegal in Dubai right now, but MGM has quietly built out a 300,000 square foot space there. Cowen paints a clear picture: "One day if Dubai decides to legalize gambling, guess where it's going? Right there." He believes if this regulatory shift occurs, that single Dubai property could add another $40 to $50 per share to MGM's valuation. It’s a bet on future regulatory change, with the physical infrastructure already in place, waiting.

Diller's Deep Pockets and the Timing

Cowen’s thesis gets stronger when he factors in Barry Diller. The media mogul has been aggressively buying MGM stock, now owning a 26% stake in the company. Diller even made a recent bid to acquire the company. Cowen points out, “Barry now owns 26% of the company... Barry Diller understands gambling. He understands casinos.” This large insider stake, coupled with Diller's history and recent actions, creates a strong floor for the stock and signals conviction in its future. It suggests Diller sees the same hidden value Cowen highlights, specifically the Japanese opportunity.

Beyond the assets and insider buying, Cowen emphasizes timing. He notes that the market tends to price in these types of major casino developments roughly three years before they open. With Osaka on the horizon, Cowen believes, “we're almost in that time frame, which is why we think it's opportunistically the right period of time.” His simple math boils down to: Vegas assets worth about $60, Japan adding $50, and Dubai another $40-$50 if it materializes. This totals up to a potential triple from where the stock sits today, built on assets the market is only just beginning to consider.

What to Do With This

Founders, apply Cowen's "hidden asset" mindset to your own business this week. Instead of focusing solely on your primary revenue drivers, dig into what unused or under-leveraged assets you already own. Do you have intellectual property sitting dormant? A partnership that hasn't fully scaled? A physical space with zoning potential? Identify these "free options"—assets that could become disproportionately valuable if an external condition shifts, whether it’s a regulatory change or a market trend. Also, consider the "three-year window" Cowen mentions: what major trends or market shifts are three years out that could turn a currently undervalued part of your business into your next big growth engine?