Teekay Tankers (TNK) AI Stock Analysis

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Teekay Tankers

(NYSE:TNK)

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Neutral 68 (OpenAI - 5.2)

Rating:68Neutral

Price Target:

$70.00

▲(8.49% Upside)

Teekay Tankers' overall score is driven by its strong valuation metrics, suggesting potential undervaluation and a solid dividend yield. Financial performance is stable but challenged by declining revenue and cash flow. Technical indicators suggest the stock is oversold, which may present a buying opportunity.

Positive Factors

Low leverage / strong balance sheet

Extremely low debt-to-equity gives Teekay Tankers durable financial flexibility to withstand shipping cycles, fund fleet renewal or opportunistic vessel purchases, and reduce refinancing risk. This supports long-term capital allocation and shareholder returns even in downturns.

High profitability margins

Sustained high EBIT and net margins indicate structural operating efficiency and pricing power in core tanker operations. Robust margins help preserve cash generation when revenues soften and provide buffer to fund maintenance capex and dividends over multi-quarter cycles.

Active fleet renewal and asset management

A deliberate fleet renewal program modernizes assets, improves fuel and operational efficiency, and enhances charter appeal. Asset sales and targeted purchases can unlock gains and reshape the fleet mix for longer-term competitiveness and lower operating costs.

Negative Factors

Declining revenue trend

A continuing top-line decline pressures long-term growth prospects and limits the margin of safety for reinvestment. Persistent revenue weakness, even with strong margins, can constrain fleet expansion, charter negotiation leverage, and future earnings resilience over several quarters.

Free cash flow contraction

A nearly 50% drop in free cash flow growth materially reduces capacity to fund capex, pay dividends, or accelerate debt reduction. Even with strong operating cash conversion to net income, sustained FCF weakness limits strategic optionality and raises funding risk for fleet projects.

Exposure to spot market cyclicality

Structural reliance on a charter mix that includes spot exposure makes revenues and utilization volatile across cycles. Shipping rate swings and oil demand changes can quickly reverse earnings, reducing predictability of cash flows and complicating long-term planning and contract strategy.

Teekay Tankers (TNK) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$2.23B

Dividend Yield3.72%

Average Volume (3M)365.79K

Price to Earnings (P/E)7.2

Beta (1Y)0.75

Revenue Growth-20.11%

EPS Growth-26.44%

CountryUS

Employees2,330

SectorEnergy

Sector Strength52

IndustryOil & Gas Midstream

Share Statistics

EPS (TTM)1.54

Shares Outstanding29,912,968

10 Day Avg. Volume347,660

30 Day Avg. Volume365,789

Financial Highlights & Ratios

PEG Ratio-0.15

Price to Book (P/B)0.78

Price to Sales (P/S)1.11

P/FCF Ratio3.45

Enterprise Value/Market Cap0.68

Enterprise Value/Revenue1.44

Enterprise Value/Gross Profit6.57

Enterprise Value/Ebitda3.62

Forecast

1Y Price Target

$66.00

Price Target Upside2.29% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering1

EPS Forecast (FY)N/A

Revenue Forecast (FY)N/A

Teekay Tankers Business Overview & Revenue Model

Company DescriptionTeekay Tankers Ltd. provides marine transportation services to oil industries in Bermuda and internationally. The company offers voyage and time charter services; and offshore ship-to-ship transfer services of commodities primarily crude oil and refined oil products, as well as liquid gases and various other products. It also provides tanker commercial and technical management services. As of December 31, 2021, the company owned and leased 48 double-hull oil tankers, time-chartered in two Aframax tankers, and one LR2 tanker. Teekay Tankers Ltd. was incorporated in 2007 and is headquartered in Hamilton, Canada.

How the Company Makes MoneyTeekay Tankers generates revenue primarily through the chartering of its tanker fleet. The company operates under two main business models: time charters and spot charters. In time charters, Teekay enters into long-term contracts with customers, providing stable and predictable revenue streams. In spot charters, the company capitalizes on market demand by providing vessels for short-term contracts, which can lead to higher earnings during peak market conditions. Additionally, the company may engage in contracts of affreightment, where it arranges the transportation of cargo over several voyages. Teekay Tankers also benefits from strategic partnerships with oil companies and trading houses, which can enhance its market position and provide consistent business opportunities. Factors such as fluctuations in global oil demand, shipping rates, and regulatory changes in the maritime industry also play significant roles in influencing the company's earnings.

Teekay Tankers Key Performance Indicators (KPIs)

Any

Suezmax Revenue Days

Suezmax Revenue Days
Measures the number of days Suezmax tankers generate revenue, indicating fleet utilization and market demand for this vessel type.

Chart InsightsTeekay Tankers' Suezmax revenue days have shown a declining trend, particularly in 2025, reflecting strategic fleet renewal activities, including the sale of 11 vessels. Despite this reduction, the company maintains a strong financial position with no debt and significant cash reserves. The earnings call highlights potential upside from increased oil production and spot rate strength, though market volatility and geopolitical uncertainties pose risks. The strategic focus on fleet modernization and financial flexibility positions Teekay Tankers to capitalize on favorable market dynamics while navigating potential challenges.

Data provided by:

The Fly

Teekay Tankers Earnings Call Summary

Earnings Call Date:Aug 01, 2025

(Q2-2025)

% Change Since: |

Next Earnings Date:Feb 19, 2026

Earnings Call Sentiment Positive

The earnings call reflected a strong financial performance with significant cash generation, strategic fleet management, and no debt, which positions the company positively. However, the call highlighted potential challenges due to market volatility and geopolitical uncertainties, which could impact future performance.

Q2-2025 Updates

Positive Updates

Strong Financial Performance

Teekay Tankers reported GAAP net income of $62.6 million or $1.81 per share and adjusted net income of $48.7 million or $1.41 per share in the second quarter, with strong free cash flow generation of $62.8 million.

Debt-Free and Strong Cash Position

The company has a cash and short-term investment position of $712 million and no debt, providing financial strength and flexibility.

Positive Market Dynamics

Second quarter spot rates were counter seasonally strong with rates outperforming the last two quarters and above long-term averages.

Strategic Fleet Renewal and Sales

Teekay Tankers sold 4 Suezmaxes and 1 LR2 for a total of $158.5 million, expecting a book gain of approximately $46 million. In total, 11 vessels were sold for $340 million, with estimated book gains of $100 million.

Dividend Declaration

Teekay Tankers declared its regular quarterly fixed dividend of $0.25 per share.

Negative Updates

Market Volatility and Geopolitical Uncertainty

The tanker market is expected to exhibit volatility due to geopolitical factors, including OPEC+ production adjustments, EU price caps on Russian crude, and US sanctions on Iranian vessels.

Seasonal Rate Softening

Spot tanker rates softened in line with normal seasonal trends, particularly during the summer months.

Lower Oil Demand Projections

Global oil demand is projected to increase by 0.7 million barrels per day in both 2025 and 2026, lower than initial projections made at the start of the year.

Company Guidance

During the Teekay Group's Second Quarter 2025 earnings call, the company provided a comprehensive overview of its financial performance and strategic initiatives. Teekay Tankers reported a GAAP net income of $62.6 million, or $1.81 per share, and an adjusted net income of $48.7 million, or $1.41 per share. The company generated $62.8 million in free cash flow from operations, ending the quarter with a strong cash position of $712 million and no debt. Teekay Tankers executed fleet renewal strategies by selling 11 vessels for $340 million in gross proceeds, resulting in an estimated book gain of $100 million, while also acquiring modern vessels, including a Suezmax and a 50% ownership stake in a VLCC. The company secured spot rates of $31,400 per day for Suezmax and $28,200 per day for Aframax LR2 fleets, with 43% of the spot base booked. Teekay Tankers anticipates increased oil production in the second half of the year, driven by OPEC+ unwinding supply cuts and higher production from South America, which could support tanker rates. The company also declared a regular quarterly dividend of $0.25 per share and emphasized its strong financial position, with a low free cash flow breakeven of $13,000 per day, enabling continued fleet renewal and value creation.

Teekay Tankers Financial Statement Overview

Summary

Teekay Tankers demonstrates strong profitability and financial stability with low leverage and efficient cash generation. However, recent declines in revenue and free cash flow growth present potential challenges.

Income Statement

Positive

Teekay Tankers shows strong profitability with a TTM net profit margin of 27.44% and an EBIT margin of 27.89%. However, revenue has declined by 1.35% in the TTM period, indicating potential challenges in maintaining growth. Historical data shows fluctuating revenue growth, with a significant decline in 2021, but recovery in subsequent years.

Balance Sheet

Positive

The company maintains a solid balance sheet with a low debt-to-equity ratio of 0.027 in the TTM period, reflecting strong financial stability. Return on equity is healthy at 16.20%, although it has decreased from previous years. The equity ratio remains robust, indicating a strong capital structure.

Cash Flow

Positive

Cash flow analysis reveals a decline in free cash flow growth by 49.36% in the TTM period, which could impact future investments. However, the operating cash flow to net income ratio is strong at 2.46, suggesting efficient cash generation relative to earnings.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.04B	1.23B	1.47B	1.18B	542.37M	886.43M
Gross Profit	229.21M	394.30M	581.67M	305.97M	-58.01M	251.42M
EBITDA	416.34M	505.13M	657.75M	372.45M	-103.19M	329.63M
Net Income	323.84M	403.67M	519.89M	235.43M	-242.37M	87.32M
Balance Sheet
Total Assets	2.11B	1.97B	1.94B	1.78B	1.62B	1.84B
Cash, Cash Equivalents and Short-Term Investments	797.78M	534.33M	391.46M	180.51M	50.57M	97.23M
Total Debt	43.35M	62.29M	224.68M	576.20M	654.03M	617.00M
Total Liabilities	181.93M	217.42M	391.51M	713.65M	780.34M	761.34M
Stockholders Equity	1.93B	1.76B	1.55B	1.07B	838.41M	1.08B
Cash Flow
Free Cash Flow	100.02M	396.57M	615.87M	177.84M	-128.76M	331.92M
Operating Cash Flow	292.51M	471.91M	626.07M	193.26M	-107.31M	347.94M
Investing Cash Flow	149.11M	-5.11M	17.26M	51.22M	38.14M	74.52M
Financing Cash Flow	-165.88M	-343.40M	-464.75M	-113.05M	21.95M	-416.10M

Teekay Tankers Technical Analysis

Technical Analysis Sentiment

Positive

Last Price64.52

Price Trends

50DMA

57.52

Positive

100DMA

56.29

Positive

200DMA

50.16

Positive

Market Momentum

MACD

2.04

Negative

RSI

70.39

Negative

STOCH

86.06

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TNK, the sentiment is Positive. The current price of 64.52 is above the 20-day moving average (MA) of 59.77, above the 50-day MA of 57.52, and above the 200-day MA of 50.16, indicating a bullish trend. The MACD of 2.04 indicates Negative momentum. The RSI at 70.39 is Negative, neither overbought nor oversold. The STOCH value of 86.06 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TNK.

Teekay 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
NVGS	79 Outperform	$1.21B	12.35	8.57%	1.27%	2.46%	33.89%
STNG	72 Outperform	$3.29B	10.36	9.63%	3.19%	-35.37%	-57.86%
INSW	72 Outperform	$2.95B	13.58	11.43%	6.12%	-23.59%	-57.70%
DHT	72 Outperform	$2.30B	11.52	18.81%	6.12%	-16.45%	23.94%
TNK	68 Neutral	$2.23B	7.16	17.02%	3.72%	-20.11%	-26.44%
LPG	66 Neutral	$1.27B	13.26	8.81%	13.08%	-27.21%	-62.22%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%

* Energy Sector Average

Performance Comparison

TNK

Teekay Tankers

64.52

24.26

60.26%

DHT

DHT Holdings

14.33

3.58

33.35%

STNG

Scorpio Tankers

63.62

17.36

37.53%

NVGS

Navigator Holdings

18.53

2.19

13.42%

LPG

Dorian LPG

29.53

7.17

32.09%

INSW

International Seaways

59.65

23.34

64.27%

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: Dec 02, 2025