Is Now The Time To Put Tidewater (NYSE:TDW) On Your Watchlist?

The excitement of investing in a company that can reverse its fortunes is a big draw for some speculators, so even companies that have no revenue, no profit, and a record of falling short, can manage to find investors. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. Loss making companies can act like a sponge for capital - so investors should be cautious that they're not throwing good money after bad.

If this kind of company isn't your style, you like companies that generate revenue, and even earn profits, then you may well be interested in Tidewater (NYSE:TDW). Even if this company is fairly valued by the market, investors would agree that generating consistent profits will continue to provide Tidewater with the means to add long-term value to shareholders.

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How Fast Is Tidewater Growing Its Earnings Per Share?

Tidewater has undergone a massive growth in earnings per share over the last three years. So much so that this three year growth rate wouldn't be a fair assessment of the company's future. Thus, it makes sense to focus on more recent growth rates, instead. Tidewater's EPS shot up from US$3.07 to US$4.02; a result that's bound to keep shareholders happy. That's a commendable gain of 31%.

It's often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company's growth. While we note Tidewater achieved similar EBIT margins to last year, revenue grew by a solid 7.8% to US$1.4b. That's encouraging news for the company!

You can take a look at the company's revenue and earnings growth trend, in the chart below. Click on the chart to see the exact numbers.

Check out our latest analysis for Tidewater

Fortunately, we've got access to analyst forecasts of Tidewater's future profits. You can do your own forecasts without looking, or you can take a peek at what the professionals are predicting.

Are Tidewater Insiders Aligned With All Shareholders?

It's said that there's no smoke without fire. For investors, insider buying is often the smoke that indicates which stocks could set the market alight. This view is based on the possibility that stock purchases signal bullishness on behalf of the buyer. However, small purchases are not always indicative of conviction, and insiders don't always get it right.

It's pleasing to note that insiders spent US$4.1m buying Tidewater shares, over the last year, without reporting any share sales whatsoever. The shareholders within the general public should find themselves expectant and certainly hopeful, that this large outlay signals prescient optimism for the business. Zooming in, we can see that the biggest insider purchase was by President Quintin Kneen for US$2.0m worth of shares, at about US$48.06 per share.

Along with the insider buying, another encouraging sign for Tidewater is that insiders, as a group, have a considerable shareholding. To be specific, they have US$49m worth of shares. That's a lot of money, and no small incentive to work hard. While their ownership only accounts for 1.9%, this is still a considerable amount at stake to encourage the business to maintain a strategy that will deliver value to shareholders.

Shareholders have more to smile about than just insiders adding more shares to their already sizeable holdings. That's because on our analysis the CEO, Quintin Kneen, is paid less than the median for similar sized companies. Our analysis has discovered that the median total compensation for the CEOs of companies like Tidewater with market caps between US$2.0b and US$6.4b is about US$7.1m.

Tidewater's CEO took home a total compensation package worth US$5.9m in the year leading up to December 2024. That comes in below the average for similar sized companies and seems pretty reasonable. CEO compensation is hardly the most important aspect of a company to consider, but when it's reasonable, that gives a little more confidence that leadership are looking out for shareholder interests. Generally, arguments can be made that reasonable pay levels attest to good decision-making.

Is Tidewater Worth Keeping An Eye On?

For growth investors, Tidewater's raw rate of earnings growth is a beacon in the night. Not only that, but we can see that insiders both own a lot of, and are buying more shares in the company. These things considered, this is one stock worth watching. Now, you could try to make up your mind on Tidewater by focusing on just these factors, or you could also consider how its price-to-earnings ratio compares to other companies in its industry.

Keen growth investors love to see insider activity. Thankfully, Tidewater isn't the only one. You can see a a curated list of companies which have exhibited consistent growth accompanied by high insider ownership.

Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.