Buried within Full House Resorts' recent earnings call is a subtle but potent revelation. While analysts focus on the obvious – the impressive performance of American Place, the phased opening of Chamonix, and the looming financing for the permanent Waukegan casino – a deeper trend goes unnoticed: Full House is quietly transforming into a regional gaming powerhouse through a strategy of **deliberate inefficiency.**

Yes, you read that right. Inefficiency. But before you dismiss this as financial mismanagement, consider this: Full House isn't simply inefficient, it's **strategically inefficient.** They're consciously choosing to operate their temporary facilities at a level below their full potential, strategically delaying the full ramp-up of their newest properties.

This seemingly counterintuitive approach is actually a shrewd long game. By extending the lifespan of the temporary American Place facility to August 2027, Full House buys itself valuable time – time to capitalize on a confluence of factors that could dramatically alter the company's financial trajectory and stock price.

Let's break it down. Full House's legacy properties are generating a stable adjusted EBITDA of $30-35 million annually. This alone largely covers the company's existing debt burden, a significant point often overlooked by those focusing on the company's overall debt.

Meanwhile, the temporary American Place, despite its unassuming exterior, is already exceeding expectations. While February gaming revenue hasn't been officially released, management confidently stated it will be north of $9 million, shattering the December record of $8.2 million. This suggests American Place is quickly establishing a new performance floor, laying the foundation for much stronger future growth.

Similarly, Chamonix, with its phased opening, is demonstrating the untapped potential of the Colorado Springs market. The property is easily achieving 80-90% occupancy on weekends, proving the demand for a high-quality gaming experience in the area.

Now, here's where the strategic inefficiency comes in. Full House is consciously choosing to not aggressively market these properties during their temporary phases. They're holding back on marketing spend, gradually introducing amenities, and even using prime meeting space as a makeshift restaurant.

Why? Because they don't need to rush. The August 2027 extension for the temporary American Place gives them a comfortable window to let their newest properties naturally season. This not only allows for smooth operational adjustments and employee training, it also maximizes free cash flow generation.

Full House expects $100 million in incremental EBITDA from the fully ramped-up American Place and Chamonix, on top of the stable contribution from their legacy properties. This translates to a potential adjusted EBITDA in the range of $130-135 million.

Consider this: if Full House can maintain its current cost structure, a reasonable assumption given their focus on efficiency, this surge in EBITDA would translate to a net income of over $90 million. With a share count of roughly 35 million, this translates to an earnings per share of over $2.50.

Now, imagine Full House refinancing its debt in a year or two, a highly likely scenario given the expected improvement in their credit profile and potentially lower interest rates. With a significantly reduced debt burden and a robust cash flow, Full House could self-fund a substantial portion of the Permanent American Place, further bolstering their financial position.

This is the gold mine no one is seeing. Full House is strategically positioning itself to become a regional gaming giant, not through aggressive acquisitions or risky expansion, but through calculated inefficiency that is maximizing free cash flow, delaying significant capital expenditures, and allowing for a natural, sustainable ramp-up of their newest properties.

The market is missing this crucial element of Full House's strategy. Investors are preoccupied with the perceived need for imminent debt financing and the daunting cost of the permanent Waukegan casino. However, the reality is that Full House has the luxury of time, a luxury they are expertly leveraging to their advantage.

This unseen advantage is what makes Full House Resorts a compelling investment opportunity. As their carefully crafted strategy unfolds, their true potential will become evident. The question is, will the market wake up to this before it's too late?

Projected EBITDA Growth

The following chart illustrates the potential growth in Full House Resorts' EBITDA based on management's projections and the article's analysis.

Hypothesis and Numbers:

This suggests a potential 5x increase in earnings per share, making the current stock price appear significantly undervalued.

"Cripple Creek, where the Chamonix Casino Hotel is located, was once one of the richest gold mining towns in the United States. During its peak in the late 19th century, the town produced over $2 million in gold annually. This historical context adds an intriguing layer to Full House Resorts' investment in the area, as they are essentially mining for a different kind of gold in the 21st century: gaming revenue."