Is Boston Omaha Corporation (NASDAQ:BOMN) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.
Boston Omaha Corporation (NASDAQ:BOMN) investors should pay attention to an increase in enthusiasm from smart money recently. BOMN was in 7 hedge funds' portfolios at the end of September. There were 5 hedge funds in our database with BOMN holdings at the end of the previous quarter. Our calculations also showed that BOMN isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings). Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
To most traders, hedge funds are seen as unimportant, outdated investment vehicles of the past. While there are over 8000 funds in operation at present, Our experts hone in on the aristocrats of this group, about 750 funds. These hedge fund managers have their hands on the lion's share of all hedge funds' total asset base, and by tailing their best picks, Insider Monkey has determined numerous investment strategies that have historically outpaced the broader indices. Insider Monkey's flagship short hedge fund strategy defeated the S&P 500 short ETFs by around 20 percentage points per year since its inception in May 2014. Our portfolio of short stocks lost 27.8% since February 2017 (through November 21st) even though the market was up more than 39% during the same period. We just shared a list of 7 short targets in our latest quarterly update .
[caption id="attachment_26575" align="aligncenter" width="600"] Louis Bacon Moore of Moore Capital[/caption]
We leave no stone unturned when looking for the next great investment idea. For example Discover is offering this insane cashback card, so we look into shorting the stock. One of the most bullish analysts in America just put his money where his mouth is. He says, "I'm investing more today than I did back in early 2009." So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We even check out this option genius' weekly trade ideas. This December, we recommended Adams Energy as a one-way bet based on an under-the-radar fund manager's investor letter and the stock already gained 20 percent. Now we're going to take a glance at the fresh hedge fund action encompassing Boston Omaha Corporation (NASDAQ:BOMN).
How are hedge funds trading Boston Omaha Corporation (NASDAQ:BOMN)?
At Q3's end, a total of 7 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 40% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in BOMN over the last 17 quarters. With the smart money's positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
Among these funds, Magnolia Capital Fund held the most valuable stake in Boston Omaha Corporation (NASDAQ:BOMN), which was worth $200.8 million at the end of the third quarter. On the second spot was Millennium Management which amassed $1.5 million worth of shares. Moore Global Investments, Renaissance Technologies, and Horizon Asset Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Magnolia Capital Fund allocated the biggest weight to Boston Omaha Corporation (NASDAQ:BOMN), around 22.48% of its 13F portfolio. Moore Global Investments is also relatively very bullish on the stock, dishing out 0.04 percent of its 13F equity portfolio to BOMN.
As industrywide interest jumped, key hedge funds have been driving this bullishness. Millennium Management, managed by Israel Englander, created the most valuable position in Boston Omaha Corporation (NASDAQ:BOMN). Millennium Management had $1.5 million invested in the company at the end of the quarter. Ken Griffin's Citadel Investment Group also made a $0.3 million investment in the stock during the quarter.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as Boston Omaha Corporation (NASDAQ:BOMN) but similarly valued. We will take a look at BBX Capital Corporation (NYSE:BBX), Avianca Holdings SA (NYSE:AVH), DryShips Inc. (NASDAQ:DRYS), and Cowen Inc. (NASDAQ:COWN). This group of stocks' market valuations are closest to BOMN's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position BBX,14,29039,-1 AVH,3,6791,-1 DRYS,7,19825,5 COWN,19,87839,0 Average,10.75,35874,0.75 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 10.75 hedge funds with bullish positions and the average amount invested in these stocks was $36 million. That figure was $205 million in BOMN's case. Cowen Inc. (NASDAQ:COWN) is the most popular stock in this table. On the other hand Avianca Holdings SA (NYSE:AVH) is the least popular one with only 3 bullish hedge fund positions. Boston Omaha Corporation (NASDAQ:BOMN) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed that top 20 most popular stocks among hedge funds returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. A small number of hedge funds were also right about betting on BOMN, though not to the same extent, as the stock returned 7.6% during the first two months of the fourth quarter and outperformed the market.
Disclosure: None. This article was originally published at Insider Monkey.