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Why Did Boston Omaha Hit a New All-Time High on Wednesday?

By Matthew Frankel, CFP® - Feb 17, 2021 at 4:30PM

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The early-stage conglomerate is adding to its recent gains.

What happened

The stock market was having a so-so day on Wednesday, with the S&P 500 index hovering near the flatline for much of the trading day. However, holding company Boston Omaha Corporation (BOC 2.51%) was a big standout, with shares rallying by almost 10% to a fresh, all-time high.

So what

There isn't any company-specific news, but the most likely explanation for today's move is that yesterday was the day when institutional investors (hedge funds, mutual funds, etc.) had to report their holdings to the U.S. Securities and Exchange Commission (SEC). To make a long story short, it appears that the big players were net buyers of Boston Omaha in the fourth quarter.

Two stock traders looking at screens.

Image source: Getty Images.

For example, T. Rowe Price (TROW 2.28%), which owns Boston Omaha shares in some of its actively managed mutual funds, reported increasing its stake to more than 8% of the entire company. Goldman Sachs (GS 2.53%) increased the number of Boston Omaha shares under its control by about 50% during Q4. Hedge fund Geode Capital Management bought more than 105,000 new shares and now owns 1.1% of Boston Omaha. I could go on.

Now what

For the first few years of its existence, Boston Omaha was an extremely interesting idea: Warren Buffett's grandnephew (Boston Omaha's Co-CEO Alex Rozek) building a Berkshire Hathaway (NYSE: BRK.A)(BRK.B 0.75%)-type conglomerate from scratch.

In recent months, however, we're starting to see the actual results of Boston Omaha's investment strategies, and they've been impressive. The minority investment in recent-IPO Dream Finders Homes (DFH 0.65%) is an example of a big windfall. And it now appears that institutional investors are starting to recognize the potential as well.

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Stocks Mentioned

Boston Omaha Corporation Stock Quote
Boston Omaha Corporation
BOC
$20.82 (2.51%) $0.51
Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
BRK.B
$310.36 (0.75%) $2.30
The Goldman Sachs Group, Inc. Stock Quote
The Goldman Sachs Group, Inc.
GS
$306.99 (2.53%) $7.58
T. Rowe Price Group, Inc. Stock Quote
T. Rowe Price Group, Inc.
TROW
$121.96 (2.28%) $2.72
Dream Finders Homes, Inc. Stock Quote
Dream Finders Homes, Inc.
DFH
$17.11 (0.65%) $0.11

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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