Scorpio Tankers (STNG) AI Stock Analysis

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Scorpio Tankers

(NYSE:STNG)

Rating:85Outperform

Price Target:

$54.00

▲(10.20% Upside)

Scorpio Tankers scores highly due to its strong financial performance, technical indicators, and attractive valuation. The company's ability to manage debt and maintain liquidity, coupled with strategic investments and a favorable market environment, supports a positive outlook. However, attention to geopolitical and macroeconomic risks is necessary.

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 Management

Repurchases of the last three sale-leaseback vessels are expected to reduce debt by $66 million, leaving no remaining vessels under sale-leaseback.

Earnings

Scorpio Tankers posted second-quarter results that exceeded expectations due to higher revenues from beneficial mix and increased LR2 rates.

Negative Factors

Capacity and Rates

Decelerating rates and increasing capacity are expected to lead to thinner cash flow going forward.

Market Rates

Market rates are trending at or below target levels, with expected seasonal softening through the third quarter.

Revenue Projections

Product tanker rates ended below target and continue to trend downwards, impacting revenue projections.

Scorpio Tankers (STNG) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$2.43B

Dividend Yield3.4%

Average Volume (3M)1.29M

Price to Earnings (P/E)3.5

Beta (1Y)0.45

Revenue Growth-7.25%

EPS Growth31.85%

CountryUS

Employees24

SectorEnergy

Sector Strength49

IndustryOil & Gas Midstream

Share Statistics

EPS (TTM)1.41

Shares Outstanding51,016,290

10 Day Avg. Volume1,174,088

30 Day Avg. Volume1,293,817

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 Cap1.17

Enterprise Value/Revenue2.66

Enterprise Value/Gross Profit4.90

Enterprise Value/Ebitda3.95

Forecast

1Y Price Target

$62.00

Price Target Upside26.53% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering4

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 Inc. primarily generates revenue through the chartering of its fleet of product tankers. The company earns money by entering into time charters, where it leases its vessels to customers for a fixed period, and spot charters, where vessels are hired for single voyages at prevailing market rates. These arrangements allow Scorpio Tankers to capitalize on shipping rate fluctuations. Key revenue streams include voyage revenues from transporting refined petroleum products and time charter revenues from leasing ships. The company's earnings are influenced by factors such as global demand for oil and refined products, charter rates, fleet utilization, and operational efficiency. Strategic partnerships with major oil producers, refiners, and trading companies can also contribute to its revenue by providing consistent business opportunities.

Scorpio Tankers Earnings Call Summary

Earnings Call Date:Jul 30, 2025

(Q2-2025)

% Change Since: 8.65%|

Next Earnings Date:Nov 06, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted strong financial performance, significant debt reduction, and positive market indicators, supported by strategic investment returns. However, persistent geopolitical and macroeconomic uncertainties were notable concerns, balancing the overall sentiment.

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.

Significant Debt Reduction

The company reduced its net debt by $2.5 billion since December 2021, with current net debt at $438 million.

Increased Liquidity

Scorpio Tankers' liquidity stands at approximately $1.4 billion, including cash, undrawn revolving credit, and investment in DHT.

Fleet Efficiency Enhancements

Completed dry docks for 8 vessels in Q2 and 71 vessels over the last 7 quarters, enhancing fleet efficiency.

Positive Market Indicators

Bookings to date averaging approximately $22,000/day for MRs and $31,000/day for LR2s, indicating strong market demand.

Strategic Investment Returns

Realized a 16% return by selling 2.7 million shares of DHT at over $12 per share.

Negative Updates

Geopolitical Uncertainty

Ongoing geopolitical risks, including tensions between Israel and Iran, Houthi attacks, and the Ukraine conflict, create market noise and uncertainty.

Macroeconomic Concerns

Unresolved issues like trade policies and tariffs, and the potential for an economic slowdown, remain concerns despite a lower likelihood of recession.

Minimal Fleet Expansion Plans

No immediate plans to expand or rejuvenate the fleet, focusing on maintaining current operations amid market uncertainties.

Company Guidance

In the Scorpio Tankers Second Quarter 2025 Conference Call, the company reported impressive financial performance metrics, with adjusted EBITDA reaching $144.5 million and adjusted net income totaling $67.8 million. The company's liquidity, including cash and revolving credit, stood at approximately $1.4 billion. Operationally, Scorpio Tankers completed dry docks for eight vessels in the quarter, contributing to fleet efficiency. Commercially, they added a vessel on a 12-year bareboat charter with a time charter equivalent rate exceeding $21,000 per day. The company also reduced its lease obligations significantly, from $2.2 billion at the start of 2022 to below $70 million by the transcript date, with plans to eliminate this entirely in a few months. Additionally, the company generated over $240 million in year-to-date operating cash flow and maintained a cash breakeven point of $12,500 per day. Looking ahead, the company remains optimistic, supported by OPEC's production increase and favorable market dynamics, while continuing to exercise caution in capital allocation due to global uncertainties.

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

Very Positive

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.

Balance Sheet

Positive

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.

Cash Flow

Positive

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.

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

Technical Analysis Sentiment

Positive

Last Price49.00

Price Trends

50DMA

42.84

Positive

100DMA

40.36

Positive

200DMA

44.55

Positive

Market Momentum

MACD

1.39

Negative

RSI

59.63

Neutral

STOCH

72.08

Neutral

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 is above the 20-day moving average (MA) of 45.21, above the 50-day MA of 42.84, and above the 200-day MA of 44.55, indicating a bullish trend. The MACD of 1.39 indicates Negative momentum. The RSI at 59.63 is Neutral, neither overbought nor oversold. The STOCH value of 72.08 is Neutral, 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 (66)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
STNG	85 Outperform	$2.43B	3.46	24.68%	3.40%	-7.25%	31.85%
INSW	79 Outperform	$2.13B	6.69	12.61%	9.29%	-22.01%	-54.34%
TNK	76 Outperform	$1.59B	5.64	15.78%	4.40%	-21.71%	-37.58%
LPG	76 Outperform	$1.31B	26.61	4.54%	10.54%	-42.64%	-84.82%
DHT	76 Outperform	$1.89B	10.60	17.90%	6.92%	-5.32%	5.51%
Sector *	66 Neutral	$15.10B	10.40	7.41%	5.56%	4.52%	-70.52%
GEL	48 Neutral	$2.09B	―	-14.68%	3.86%	-28.72%	-1173.53%

* Energy Sector Average

Performance Comparison

STNG

Scorpio Tankers

47.02

-24.52

-34.27%

DHT

DHT Holdings

11.70

1.53

15.04%

GEL

Genesis Energy

17.10

4.30

33.59%

TNK

Teekay Tankers

45.43

-7.53

-14.22%

LPG

Dorian LPG

30.37

-2.69

-8.14%

INSW

International Seaways

43.08

-1.44

-3.23%

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.Date of analysis: Jul 31, 2025