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Here’s Why Praetorian Capital Added Tidewater (TDW)

Praetorian Capital, an investment management company, released its first-quarter 2024 investor letter. The fund was up by 9.25% net of fees in the first quarter. A copy of the letter can be downloaded here. The core portfolio positions saw both advances and declines in the first quarter, but the Event-Driven book generated a decent return for the first time in many quarters. For more information on the fund’s top picks in 2024, please check its top five holdings.

Praetorian Capital featured stocks like Tidewater Inc. (NYSE:TDW) in the first quarter 2024 investor letter. Headquartered in Houston, Texas, Tidewater Inc. (NYSE:TDW) provides offshore support vessels and marine support services to the offshore energy industry. On May 1, 2024, Tidewater Inc. (NYSE:TDW) stock closed at $91.42 per share. One-month return of Tidewater Inc. (NYSE:TDW) was -6.73%, and its shares gained 121.36% of their value over the last 52 weeks. Tidewater Inc. (NYSE:TDW) has a market capitalization of $4.816 billion.

Praetorian Capital stated the following regarding Tidewater Inc. (NYSE:TDW) in its first quarter 2024 investor letter:

“Energy Services Basket (Valaris (VAL – USA), Tidewater Inc. (NYSE:TDW) – USA): In 2020 when oil traded below zero, drilling activity ground to a halt and many energy service providers declared bankruptcy. Many of these businesses had teetered on the verge of bankruptcy for years due to reduced demand and over-leveraged balance sheets. The bankruptcies led to consolidation and reduced future industry capacity, removing future competition in the recovery.

With oil prices now recovering, I believe that demand for drilling and other services will increase from subdued levels. While producers have been slow to increase spending on exploration despite recoveries in energy prices, I believe that this only extends the timing on the thesis. In the end, the only way to reduce future energy prices is to see a dramatic increase in global oilfield services spending. Any postponement of this spending only leads to higher prices and more wealth transfer from the global economy to the oil producers, which will likely end up resulting in an increase in spending on exploration and production.

We purchased many of these positions at fractions of the equipment’s replacement cost, despite restored balance sheets and positive operating cash flow. As spending in the sector recovers, I believe that the potential for cash flow will become more apparent and this equipment will trade up to valuations closer to replacement cost.”

A fleet of offshore supply vessels and tugs carrying materials to an oilrig in the distance.

Tidewater Inc. (NYSE:TDW) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database at the end of the fourth quarter, Tidewater Inc. (NYSE:TDW) was held by 39 hedge fund portfolios, compared to 39 in the previous quarter.

We previously discussed Tidewater Inc. (NYSE:TDW) in another article, where we shared the list of fastest growing energy companies in the US. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

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In fact, Verge argues this company’s supercheap AI technology should concern rivals.

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  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

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But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

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