Boston Omaha (BOC -0.77%) announced full-year 2017 results late Friday, highlighting the small financial holding company's early efforts to lay a strong foundation for the sustained, long-term creation of shareholder value.

With the stock up modestly on Monday in response, let's take a closer look at what Boston Omaha had to say and what investors should expect going forward.

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Boston Omaha results: The raw numbers




Year-Over-Year Growth


$9.014 million

$3.844 million


GAAP net income (loss) attributable to common shareholders

($6.468 million)

($3.173 million)


GAAP earnings (loss) per share




Data source: Boston Omaha 2017 10-K SEC Filing.

What happened with Boston Omaha in 2017?

  • Book value per share was $10.25 as of Dec. 31, 2017, up 13.6% from $9.02 at the end of 2016. This increase was driven entirely by stock issued at a premium to book value, which more than offset Boston Omaha's reported losses.
  • Revenue included the following:
    • $5.266 million from billboard rentals, or growth of 180% year over year.
    • $2.032 million from premiums earned, up 12-fold from just under $156,000 in 2016.
    • $1.586 million from insurance premiums, or growth of 213% year over year.
    • $130,802 from investments and other income, up from just under $17,000 in 2016.
  • As of the end of 2017, Boston Omaha had no debt and $153.5 million in total assets. Roughly 41% of those assets are invested primarily in acquired businesses, with the remaining 59% held as cash as a result of its public offering in mid 2017.
  • Cash and short-term investments have since increased to $178 million. This includes $76.9 million received from the first round of Boston Omaha's recently announced $150 million private placement of Class A common stock, as well as $11.2 million from the sale of Class A common stock in a recent shelf offering.
  • Link Media currently operates 479 billboard structures -- up from zero in 2015 -- offering 864 advertising faces in four states. Boston Omaha has invested roughly $36 million in Link Media since 2015.
  • General Indemnity Group (GIG) currently writes over $12 million of surety insurance premium annually. But Boston Omaha only reports the roughly $2 million underwritten by GIG last year, as well as the $1.6 million in commissions its agents earned after sending much of that premium to other insurance companies. 
  • At the end of 2017, Boston Omaha had invested capital of roughly $11 million toward a number of minority investments, most notably including $10 million for just under 5% of private residential homebuilder Dream Finders Homes (DFH) at the end of 2016. BOMN also acquired a 30% stake in Nevada-based Logic Real Estate Companies for $360,000

What management had to say

In Boston Omaha's third annual letter to shareholders -- which is most certainly worth a read -- management offered perspective on the company's current lack of profitability, writing the following:

Rest assured that management at the parent company is keeping costs in check and still employs only three full-time employees. At our wholly-owned subsidiaries, however, we have overhead and professional fees expensed in the period incurred, yet part of a budget that anticipates larger revenues and produces longer-term assets such as internal systems and software. Simply put, both Link Media and General Indemnity are being built to manage a lot more business than they currently handle and must have the controls in place to be a part of a public company. Until that additional revenue is brought on board, ongoing, normal course expenses will continue to be high as a percentage of revenue. 

Management also reminded investors that they have effectively transformed over the past three years from a small public real estate company with only a single asset to a NASDAQ-listed business "with a large liquid balance sheet to deploy into cash-producing assets and growing business interests in outdoor advertising, insurance, homebuilding, and real estate service industries."

"More importantly," they insisted, "Boston Omaha continues to operate with a long-term perspective and a rock-solid balance sheet."

Looking forward

Perhaps unsurprisingly, Boston Omaha didn't provide specific financial guidance -- nor should it in these early stages of its long-term growth story. 

"You are more likely to see Shoeless Joe Jackson play baseball with Kevin Costner than to catch us making quarterly or annual earnings forecasts," they added.

Rather, Boston Omaha opted to reiterate its "general decision-making framework." That framework includes goals for ensuring that employee incentives and directors' stakes improve alignment of their interests with shareholders, decentralizing their operations to allow "the right" managers to excel, and maintaining a long-term focus on enduring businesses "that will send a lot of cash to the parent company." ("The more the better.")

In the end, for shareholders who can look past Boston Omaha's near-term losses to focus instead on the much larger business it plans to become, there was nothing not to love about this report. And I'm excited to see what the future holds.