Scorpio Tankers: Hold Rating Maintained Amid Softer Rates and Revised Earnings Estimates

Scorpio Tankers (STNG – Research Report), the Energy sector company, was revisited by a Wall Street analyst on April 25. Analyst Ken Hoexter from Bank of America Securities reiterated a Hold rating on the stock and has a $42.00 price target.

Ken Hoexter has given his Hold rating due to a combination of factors related to the performance and outlook of Scorpio Tankers. The company’s product tanker rates at the end of the first quarter of 2025 were softer than anticipated, which has led to a downward revision of earnings per share estimates for 2025 and 2026. This softness in rates is expected to continue into the second quarter, prompting a reduction in revenue targets for the same periods.
Additionally, the company experienced lower than expected booking rates for its LR2 and MR vessels, which contributed to the overall decline in projected revenues. Despite these challenges, the company continues to generate strong cash flows, which balances the negative impact of rising capacity and decelerating rates. As a result, Ken Hoexter maintains a Neutral rating with a price objective of $42, reflecting a cautious stance given the current market conditions.