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Praetorian Capital, an investment management company, released its fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. For the full year, the fund lost 10.55% net of fees. The fund was down by 14.76% net of fees in the fourth quarter. It compounded capital at a 41.76% annual net rate, since inception. The core portfolio positions mostly declined in the quarter, while the event-driven book produced a slightly positive return. The core portfolio positions overall decreased over the course of the year, but the losses in the core book were offset by the event-driven book. For more information on the fund’s top picks in 2024, please check its top five holdings.
Praetorian Capital highlighted stocks like Tidewater Inc. (NYSE:TDW) in the fourth quarter 2024 investor letter. Tidewater Inc. (NYSE:TDW) provides offshore support vessels and marine support services to the offshore energy industry. The one-month return of Tidewater Inc. (NYSE:TDW) was 4.83%, and its shares lost 15.75% of their value over the last 52 weeks. On January 13, 2025, Tidewater Inc. (NYSE:TDW) stock closed at $55.08 per share with a market capitalization of $2.88 billion.
Praetorian Capital stated the following regarding Tidewater Inc. (NYSE:TDW) in its Q4 2024 investor letter:
"In 2010, at the dawning of the age of shale, offshore oil production accounted for approximately 31% of global oil supply. As shale has encroached on offshore, that number has declined to only 27% of total oil production in 2024. As you can imagine, this has led to a bear market in offshore services equipment that has lasted for more than a decade and bankrupted almost all players in the sector. This offshore equipment (Drillships, Semi-Subs, Jackups, PSVs, AHTS, and other associated pieces of highly engineered steel) is what we own through positions in Valaris (VAL – USA), Tidewater Inc. (NYSE:TDW) and Noble (NE – USA), as I believe that the decade-long bear market has now ended, and that the call on this equipment will lead to excess profits for these companies for many years into the future.