Thank you as always for the wonderful content, I'm sure your familiar with how Mohnish Pabrai's auctioned lunch with Buffett was viewed as a tuition bill. When I achieve financial success a large portion of my "tuition bill" will be to you. I have a suggestion if you haven't already previewed the company, Boston Omaha Corporation. I'm assuming you have read the novel about corporate CEOs "The Outsiders" since your wonderful book Fabrics of Success contained many similarities. I believe the CEO of BOC is an outsider type CEO maybe similar to Malone in the type of industry/businesses he is operating. In addition, the company looks "fat" if one does some back of napkin math and the market has punished the business due to some governance circumstances that arose in 2024 and 2023 mainly regarding compensation. Just thought you might like to have a look if you haven't already I believe there is minimal downside to the valuation and I also believe there is a first class management team in place. Thank you as always enjoy your day!
Thank you for your kind words - I hope you achieve financial success soon, I look forward to your tuition bill lunch! ;-)
Please feel free to spread the word and share my content with others. I am trying to build a large community of subscribers, currently ~5,000, but still a long way to go before hitting critical mass.
Boston Omaha is a business that I have never really looked at. Despite having high gross margins its OPEX always exceeds its gross profit and so it constantly has a negative operating margin. Free cash flow margins are also negative. Its working capital dynamics don't look great either and so it is constantly needing to finance itself through the issuance of debt and equity. The share count is climbing year on year, so investors are being constantly diluted. For all of these reasons, I haven't wasted any time on it. Maybe its numbers don't paint a true picture of the company, but on first impressions it doesn't look like the kind of company that John Malone would have run (https://rockandturner.substack.com/p/john-malone-learn-from-the-best). Malone used to suppress earnings to mitigate tax liabilities and he reinvested heavily to grow the business - but that is usually evident looking at the book value per share increasing sequentially which isn't happening at Boston Omaha. I see nice top line growth, but none of that seems to accrue as a benefit to shareholders. There has also been an issue internally which no one knows much about - Alex B. Rozek, Co- Chair and CEO, suddenly stepped down "to pursue new entrepreneurial opportunities" last year, something that doesn't happen when everything is going well - imagine if Charlie Munger had walked out of Berkshire ( I bet you can't). All in all, something around BOC just doesn't sit right with me, but I accept I may be entirely wrong. What am I missing?
Great article, it was definitely worth the wait after your teaser last week :)
Thank you for the great article.
Thank you as always for the wonderful content, I'm sure your familiar with how Mohnish Pabrai's auctioned lunch with Buffett was viewed as a tuition bill. When I achieve financial success a large portion of my "tuition bill" will be to you. I have a suggestion if you haven't already previewed the company, Boston Omaha Corporation. I'm assuming you have read the novel about corporate CEOs "The Outsiders" since your wonderful book Fabrics of Success contained many similarities. I believe the CEO of BOC is an outsider type CEO maybe similar to Malone in the type of industry/businesses he is operating. In addition, the company looks "fat" if one does some back of napkin math and the market has punished the business due to some governance circumstances that arose in 2024 and 2023 mainly regarding compensation. Just thought you might like to have a look if you haven't already I believe there is minimal downside to the valuation and I also believe there is a first class management team in place. Thank you as always enjoy your day!
Thank you for your kind words - I hope you achieve financial success soon, I look forward to your tuition bill lunch! ;-)
Please feel free to spread the word and share my content with others. I am trying to build a large community of subscribers, currently ~5,000, but still a long way to go before hitting critical mass.
The Outsiders by Will Thorndike is a great book. Highly recommended. This post and video were based on that book: https://rockandturner.substack.com/p/rolling-the-dice-the-leadership-gamble.
Boston Omaha is a business that I have never really looked at. Despite having high gross margins its OPEX always exceeds its gross profit and so it constantly has a negative operating margin. Free cash flow margins are also negative. Its working capital dynamics don't look great either and so it is constantly needing to finance itself through the issuance of debt and equity. The share count is climbing year on year, so investors are being constantly diluted. For all of these reasons, I haven't wasted any time on it. Maybe its numbers don't paint a true picture of the company, but on first impressions it doesn't look like the kind of company that John Malone would have run (https://rockandturner.substack.com/p/john-malone-learn-from-the-best). Malone used to suppress earnings to mitigate tax liabilities and he reinvested heavily to grow the business - but that is usually evident looking at the book value per share increasing sequentially which isn't happening at Boston Omaha. I see nice top line growth, but none of that seems to accrue as a benefit to shareholders. There has also been an issue internally which no one knows much about - Alex B. Rozek, Co- Chair and CEO, suddenly stepped down "to pursue new entrepreneurial opportunities" last year, something that doesn't happen when everything is going well - imagine if Charlie Munger had walked out of Berkshire ( I bet you can't). All in all, something around BOC just doesn't sit right with me, but I accept I may be entirely wrong. What am I missing?