Tidewater (TDW) Stands to Benefit from Energy Security Push

Third Avenue Value Fund returned 7.28% in the first quarter of 2026, handily beating the MSCI World Index's 3.57% decline and the MSCI World Value Index's loss. The fund's management credited stock selection in energy for the outperformance. Tidewater, the offshore vessel operator, has been a longtime holding for the value shop.

The backdrop is a tangible shift in energy security priorities. Russian pipeline curbs, Middle Eastern tensions, and a policy push for domestic output have lifted offshore spending. Tidewater runs the largest fleet of platform supply vessels and anchor-handling tug supply ships. Dayrates climbed through 2025 and into early 2026 as utilization settled near 85%, the fund's commentary indicated.

Higher deepwater budgets from operators such as Shell and Petrobras feed Tidewater's contract backlog. The company's most recent quarter showed fleet revenue up 12% year over year, as detailed in its Q1 2026 results. The shipyard orderbook is thin, which supports pricing for existing iron.

The stock is not cheap. Tidewater trades at 11x forward EBITDA, above its historical average. The risk is that the crisis premium deflates faster than the cycle delivers. A ceasefire in Ukraine or a détente with Iran would hit offshore names hard.

Third Avenue's bet is that demand is structural. Vessels are needed for LNG terminals and carbon capture projects that take years to build. That timeline gives Tidewater a longer tail than a one-off surge in fear.

The letter does not give explicit price targets for any holding. What it does show is that the fund's value process sees more upside than the index prices in.