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Scorpio Tankers (STNG)
NYSE:STNG
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Scorpio Tankers
(NYSE:STNG)
Rating:81Outperform
Price Target:
$54.00
▲(8.50% Upside)
Positive Factors
Cash Flow
Tanker rates are currently 2 to 3 times the breakeven level, which is helping to improve cash flow for the company.
Debt Reduction
Scorpio Tankers has significantly reduced its debt by $2.2 billion over the past two years, which has lowered its cash operating breakeven to $12,500 per day.
Financial Performance
Scorpio Tankers posted second-quarter results that exceeded expectations due to higher revenues from beneficial mix and increased LR2 rates.
Negative Factors
Capacity Increase
The product tanker Orderbook-to-Fleet ratio has climbed to 20% of the fleet, indicating a rising capacity view.
Market Rates
Market rates are trending at or below target levels, with expected seasonal softening through the third quarter.
Revenue Expectations
Rates for LR2 and MR product tankers are softer than anticipated, leading to a decrease in revenue targets.
Scorpio Tankers (STNG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.50B
Dividend Yield3.21%
Average Volume (3M)1.06M
Price to Earnings (P/E)3.5
Beta (1Y)0.46
Revenue Growth-7.25%
EPS Growth31.85%
CountryUS
Employees24
SectorEnergy
Sector Strength56
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)1.41
Shares Outstanding51,016,290
10 Day Avg. Volume901,029
30 Day Avg. Volume1,056,023
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)0.00
Price to Sales (P/S)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap1.14
Enterprise Value/Revenue2.66
Enterprise Value/Gross Profit4.90
Enterprise Value/Ebitda3.95
Forecast
1Y Price Target
$60.40Price Target Upside21.36% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering5
Scorpio Tankers Business Overview & Revenue Model
Company DescriptionScorpio Tankers Inc., together with its subsidiaries, engages in the seaborne transportation of refined petroleum products in the shipping markets worldwide. As of March 18, 2022, the company's fleet consisted of 124 owned, finance leased, or bareboat chartered-in tankers, including 42 LR2, 6 LR1, 62 MR, and 14 Handymax with a weighted average age of approximately 6.2 years. Scorpio Tankers Inc. was incorporated in 2009 and is based in Monaco.
How the Company Makes MoneyScorpio Tankers generates revenue primarily through the time and voyage chartering of its fleet. The company earns money by leasing its vessels to third parties for predetermined periods (time charters) or for specific voyages (voyage charters), with rates typically influenced by market conditions, shipping demand, and operational costs. Additionally, Scorpio Tankers may engage in spot market transactions, which can yield higher returns in favorable market conditions. The company's revenue model is supported by its strong operational efficiency, strategic fleet management, and a focus on maintaining a competitive edge through modern, eco-friendly vessels. Partnerships with oil companies and refiners also contribute to stable business relationships and revenue opportunities.
Scorpio Tankers Earnings Call Summary
Earnings Call Date:Jul 30, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a strong financial performance and positive market outlook with improved liquidity and operational efficiencies. However, ongoing geopolitical and economic uncertainties continue to pose challenges, leading to cautious capital allocation strategies.Q2-2025 Updates
Positive Updates
Strong Financial Performance
Scorpio Tankers reported $144.5 million in adjusted EBITDA and $67.8 million in adjusted net income for Q2 2025, indicating strong financial performance.
Improved Liquidity and Debt Reduction
The company reported liquidity of approximately $1.4 billion and reduced lease obligations from $2.2 billion to below $70 million, with plans to further reduce to zero.
Operational Efficiency Enhancements
Scorpio Tankers completed dry docks for 8 vessels in Q2 and 71 vessels over the last 7 quarters, enhancing fleet efficiency.
Positive Market Outlook
The company remains optimistic due to OPEC's recent production increase, strong demand for refined products, and structural changes in global refining.
Strategic Investment Returns
Scorpio Tankers realized a 16% return from selling 2.7 million DHT shares at over $12 per share.
Negative Updates
Geopolitical and Economic Uncertainty
Ongoing geopolitical risks and global economic uncertainties, such as tensions in the Middle East and unresolved trade and tariff issues, continue to pose challenges.
Market Volatility
Concerns about potential market volatility due to factors like OPEC production adjustments and geopolitical tensions, which could impact stability and profitability.
Cautious Capital Allocation
Despite strong financials, the company remains conservative in capital allocation due to persistent global uncertainties.
Company Guidance
During the Scorpio Tankers Second Quarter 2025 Conference Call, the company provided several key financial metrics and operational updates. Scorpio Tankers reported strong financial performance with $144.5 million in adjusted EBITDA and $67.8 million in adjusted net income for the second quarter. The company maintained a cash breakeven of $12,500 per day and announced liquidity of approximately $1.4 billion, including cash, undrawn revolving credit, and investments. The fleet efficiency was enhanced with the completion of dry docks for 8 vessels in the second quarter and 71 vessels over the last 7 quarters. Looking forward, the company remains optimistic with OPEC's production increase expected to boost tanker demand. Moreover, Scorpio Tankers has secured a 12-year bareboat charter for one vessel at a time charter equivalent rate above $21,000 per day. The management highlighted structural shifts in refining, longer trade routes, and an aging fleet as favorable factors for the product tanker market.Scorpio Tankers Financial Statement Overview
Summary
Scorpio Tankers is financially robust with excellent profitability margins and efficient cash flow management. Despite a decline in revenue, the company maintains a stable balance sheet with a strong equity base and manageable debt levels. Future growth hinges on addressing the declining revenue trend while continuing to leverage cash flow efficiency.Income Statement
Scorpio Tankers has demonstrated robust profitability with a strong net profit margin of 48.1% and a gross profit margin of 54.4% TTM. The EBIT margin stands at 50.3%, reflecting efficient cost management. However, the revenue has shown a declining trend from previous years, which could be a concern for sustaining future growth.85
Very Positive
Balance Sheet
The company has a healthy equity ratio of 73.5%, indicating a strong equity base relative to total assets. The debt-to-equity ratio is 0.33, showing a manageable level of debt. However, total assets have decreased over the years, suggesting that asset management could be improved.75
Positive
Cash Flow
Scorpio Tankers has a positive free cash flow growth of 11.1% TTM, a positive sign of cash generation capability. The operating cash flow to net income ratio of 1.3 TTM indicates strong cash generation relative to earnings. Despite a decline in revenue, the cash flow position remains healthy.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.07B | 1.24B | 1.34B | 1.56B | 540.79M | 915.89M |
| Gross Profit | 579.53M | 709.11M | 809.89M | 939.62M | -37.76M | 328.37M |
| EBITDA | 719.05M | 955.11M | 916.11M | 1.00B | 146.32M | 490.86M |
| Net Income | 512.80M | 668.77M | 546.90M | 637.25M | -380.60M | -62.35M |
Balance Sheet | ||||||
| Total Assets | 3.97B | 3.83B | 4.23B | 4.56B | 5.01B | 5.16B |
| Cash, Cash Equivalents and Short-Term Investments | 537.64M | 406.74M | 355.55M | 376.87M | 230.41M | 187.51M |
| Total Debt | 971.25M | 861.97M | 1.59B | 1.93B | 3.12B | 3.05B |
| Total Liabilities | 1.05B | 967.77M | 1.67B | 2.05B | 3.18B | 3.09B |
| Stockholders Equity | 2.92B | 2.87B | 2.55B | 2.51B | 1.84B | 2.07B |
Cash Flow | ||||||
| Free Cash Flow | 558.99M | 731.81M | 842.40M | 734.85M | 26.20M | 244.90M |
| Operating Cash Flow | 666.46M | 825.18M | 865.49M | 769.33M | 73.30M | 419.38M |
| Investing Cash Flow | 224.71M | 307.99M | 43.61M | 571.96M | -52.28M | -174.48M |
| Financing Cash Flow | -840.74M | -1.16B | -930.42M | -1.19B | 21.88M | -259.70M |
Scorpio Tankers Technical Analysis
Positive
49.77
Price Trends
44.30
Positive
41.16
Positive
43.32
Positive
Market Momentum
1.32
Negative
66.52
Neutral
91.30
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For STNG, the sentiment is Positive. The current price of 49.77 is above the 20-day moving average (MA) of 46.65, above the 50-day MA of 44.30, and above the 200-day MA of 43.32, indicating a bullish trend. The MACD of 1.32 indicates Negative momentum. The RSI at 66.52 is Neutral, neither overbought nor oversold. The STOCH value of 91.30 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for STNG.
Scorpio Tankers Peers Comparison
Overall Rating
UnderperformOutperform
Sector (65)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $2.50B | 3.53 | 24.68% | 3.21% | -7.25% | 31.85% | |
79 Outperform | $1.36B | 27.68 | 4.54% | 9.75% | -42.64% | -84.82% | |
79 Outperform | $1.64B | 5.91 | 15.78% | 4.15% | -21.71% | -37.58% | |
77 Outperform | $2.18B | 9.22 | 12.61% | 8.94% | -22.01% | -54.34% | |
75 Outperform | $1.83B | 9.75 | 17.90% | 6.75% | -8.89% | 21.28% | |
65 Neutral | $15.26B | 7.31 | 3.02% | 5.32% | 4.27% | -62.52% | |
56 Neutral | $2.05B | ― | -14.68% | 3.90% | -28.72% | -1173.53% |
* Energy Sector Average
Performance Comparison
STNG
Scorpio Tankers
49.77
-18.14
-26.71%
DHT
DHT Holdings
11.56
1.74
17.72%
GEL
Genesis Energy
16.93
4.17
32.68%
TNK
Teekay Tankers
48.18
-4.87
-9.18%
LPG
Dorian LPG
32.16
-1.63
-4.82%
INSW
International Seaways
44.74
-0.86
-1.89%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.