Key Takeaways

• The financial system is evolving to enable global asset trading 24/7 via digital platforms.
• Biotech investments in underappreciated companies present significant opportunities.
• MGM’s stock buybacks indicate strong confidence in its future prospects.
• Japan’s gambling market offers a lucrative opportunity for MGM with its Osaka casino.
• MGM’s Osaka casino is projected to significantly boost earnings.
• Japan offers a more stable investment environment than Macau for gaming ventures.
• MGM’s stock could triple if Dubai legalizes gambling, enhancing asset value.
• MGM’s Las Vegas and Japan assets are valued significantly, with potential gains from Dubai.
• Market interest in new casino projects typically peaks three years before opening.
• Power demand growth aligns with GDP, but tech breakthroughs can cause demand spikes.
• MGM’s strategic moves in Japan and potential in Dubai position it for future growth.
• The evolving financial landscape is democratizing access to global trading opportunities.
• Biotech’s misunderstood sectors are ripe for investment by those willing to explore niche markets.

Guest intro

Aaron Cowen is a Portfolio Manager at Suvretta Capital Management. He previously worked in investing at Millennium Management and Citadel, bringing deep public-markets experience to Suvretta’s research-driven approach.

Building a new financial system

• We’re building a new financial system from the ground up here

  — Aaron Cowen

• This new system aims to enable trading of any asset globally with just an internet connection.
• The shift represents a democratization of financial markets, making trading more accessible.
• Current trading systems have limitations that this new approach seeks to overcome.

• Anyone should be able to trade any asset anywhere in the world anytime

  — Aaron Cowen

• The vision is to create a 24/7 trading environment accessible to anyone with a phone.
• This approach could significantly alter the traditional financial landscape.
• Innovation in financial technology is a key driver of this new system’s development.

Biotech investment opportunities

• My fund ecor1 capital…investing in biotech in a slightly different way

  — Aaron Cowen

• The focus is on unfollowed, unloved, and misunderstood biotech companies.
• There is a strategic opportunity in investing in niche sectors within biotech.

• It’s an amazing moment in time for those types of companies

  — Aaron Cowen

• The biotech industry is ripe for investment due to its current undervaluation.
• Investors are encouraged to explore overlooked sectors for potential gains.
• The strategy involves identifying companies that are not on the mainstream radar.
• Biotech investments are seen as a high-potential area for future growth.

MGM’s stock acquisition and market confidence

• This company has been very aggressively been stock’s been aggressively acquired by Barry Dillard

  — Aaron Cowen

• Barry Dillard’s acquisition of 26% of MGM reflects strong market confidence.
• MGM’s stock buybacks are a rare and significant market behavior.

• Rarely have I ever seen a company in six years buy half their float back

  — Aaron Cowen

• This activity suggests a positive outlook for MGM’s future performance.
• Insider acquisitions are often a signal of a company’s strong potential.
• The aggressive stock acquisition indicates a belief in MGM’s strategic direction.
• MGM’s market actions are a testament to its perceived value and growth prospects.

Japan’s gambling market potential

• Japan actually has a reasonably large gambling market

  — Aaron Cowen

• Japan’s gambling market is larger than both Macau and Las Vegas.
• MGM’s investment in Japan is seen as a significant financial opportunity.
• The Osaka casino is expected to capitalize on Japan’s $40 billion gambling market.

• This could be a massive opportunity

  — Aaron Cowen

• Japan’s market presents a lucrative opportunity for MGM’s expansion.
• Comparisons with Macau and Las Vegas highlight Japan’s market potential.
• MGM’s strategic move into Japan aligns with its growth objectives.

MGM’s Osaka casino financial projections

• We’re estimating they’ll do about 2,000,000,000 of EBITDA

  — Aaron Cowen

• The Osaka casino is expected to significantly boost MGM’s earnings.
• MGM owns 40% of the Osaka property, enhancing its financial stake.
• The casino project includes management fees, adding to MGM’s revenue.
• Financial projections for Osaka provide a concrete expectation of future earnings.
• The Osaka project is a key component of MGM’s growth strategy.
• MGM’s investment in Osaka is projected to yield substantial financial returns.
• The casino’s expected performance aligns with MGM’s broader market goals.

Favorable investment climate in Japan

• If you think about it as an investor where would you wanna have your money

  — Aaron Cowen

• Japan offers a more stable business environment than Macau.
• Investment in Japan is seen as more favorable due to its first-world status.

• This is Japan, it’s a first world country

  — Aaron Cowen

• The stable investment climate in Japan is attractive for gaming ventures.
• Japan’s regulatory environment is considered more predictable than Macau’s.
• MGM’s strategic focus on Japan reflects confidence in its market stability.
• The investment climate in Japan supports long-term growth for MGM.

Potential impact of Dubai’s gambling legalization

• We think the stock is a triple… if Dubai happens

  — Aaron Cowen

• Legalization of gambling in Dubai could significantly increase MGM’s stock value.
• Dubai’s market potential adds an additional layer of value to MGM’s assets.

• The stock could be easily worth over 100

  — Aaron Cowen

• MGM’s assets in Las Vegas and Japan are already valued at around $60 each.
• Dubai’s potential market entry could enhance MGM’s overall asset value.
• The possibility of gambling legalization in Dubai is a key factor in MGM’s valuation.
• MGM’s strategic positioning in Dubai could yield substantial financial benefits.

Market interest in new casino projects

• The reality is it tends to be about three years before it opens

  — Aaron Cowen

• Market interest in casino projects typically peaks three years before opening.
• MGM’s Osaka project is nearing this critical timeframe for market attention.
• Historical trends indicate a predictable pattern of market interest in casinos.
• The timing of MGM’s Osaka project aligns with expected market behavior.
• Understanding market timelines is crucial for strategic investment decisions.
• MGM’s strategic planning considers historical patterns of market interest.
• The Osaka project’s timeline is strategically aligned with market expectations.

Power demand and technological breakthroughs

• A power cycle typically goes like this in normal times power demand grows about GDP

  — Aaron Cowen

• Power demand growth generally aligns with GDP growth rates.
• Technological breakthroughs can cause spikes in power demand.
• “Power demand spikes” during periods of technological advancement – Aaron Cowen
• Understanding the relationship between GDP and power demand is crucial for energy planning.
• Technological advancements are a significant factor in power demand cycles.
• The energy sector must adapt to changes in demand driven by innovation.
• Economic growth and technology are key drivers of power demand trends.