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Boston Omaha Reaps the Fruit of Recent Acquisitions

By Steve Symington – Nov 13, 2018 at 9:46PM

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But the billboard advertising and surety insurance company is just getting started.

Boston Omaha (BOC -3.08%) released strong third-quarter 2018 results on Tuesday after the market closed, highlighting three large acquisitions that significantly increased the size of its core billboard business.

With shares up modestly in after-hours trading as of this writing, let's take a closer look at how Boston Omaha kicked off the second half.

Time lapse of blank billboard next to highway and skyscrapers.


Boston Omaha results: The raw numbers


Q3 2018

Q3 2017

Year-Over-Year Growth


$5.394 million

$2.385 million


GAAP net income (loss) attributable to common shareholders

($1.931 million)

($1.512 million)


GAAP earnings (loss) per share





What happened with Boston Omaha this quarter?

  • By segment:
    • Billboard rental revenue soared 158.6% year over year to $3.754 million.
    • Premiums earned increased 48% to $814,944.
    • Insurance commissions climbed 127.2% to $793,934.
    • Investment and other income declined slightly to $30,845.
  • Boston Omaha made three large acquisitions that increased its billboard count from over 470 as of June 30, 2018, to more than 2,900 at the end of this quarter:
    • On July 31, 2018, it paid just under $16.7 million for Tammy Lynn Outdoor, a West Virginia-based outdoor advertising company with over 250 billboard faces and land costs averaging 5% of total revenue.
    • On Aug. 22, 2018, it paid $38 million for Key Outdoor, an Illinois-based company with over 700 billboard structures, almost 1,800 advertising faces, and land costs averaging 20% of revenue. 
    • On Aug. 31, 2018, it agreed to pay $82 million for essentially all assets of Waitt Outdoor, a Midwest billboard leader with over 1,600 structures and 2,500 advertising faces.
  • Boston Omaha ended the quarter with unrestricted cash and cash equivalents of roughly $4.8 million. 

What management had to say

Boston Omaha management doesn't typically offer canned statements regarding their quarterly performance. But in this quarter's 10-Q filing with the SEC, the company did remind shareholders:

In outdoor advertising, our plan is to continue to grow this business through acquisitions of billboard assets. We also expect to continue to make additional investments in real estate management service businesses, as well as in other businesses. In the future, we expect to expand the range of services we provide in the insurance sector, seek to continue to expand our billboard operations and to possibly consider acquisitions of other businesses, as well as investments, in different sectors. Our decision to expand outside of these current business sectors we serve or in which we have made investments will be based on the opportunity to acquire businesses which we believe provide the potential for sustainable earnings at an attractive level relative to capital employed and, with regard to investment, we believe have the potential to provide attractive returns.

Looking ahead

Of course, this also means that Boston Omaha will almost certainly need to raise cash again to facilitate future acquisitions. But in the meantime, investors should keep in mind that these operating results only include a partial quarter's contribution from the above-mentioned billboard additions. It will be another quarter before we have a better idea of its new annual run rates.

But in the end, this quarter demonstrates that Boston Omaha is hard at work building its business to drive sustained, profitable growth with the aim of compounding shareholder value. And I think patient investors should be more than pleased with where it stands today.

Steve Symington has no position in any of the stocks mentioned. The Motley Fool recommends Boston Omaha. The Motley Fool has a disclosure policy.

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