Education
About Us
Working with TipRanks
Follow Us
Teekay Tankers Ltd (TNK)
NYSE:TNK
Top Page
Teekay Tankers
(NYSE:TNK)
Select Model
Select Model
Rating:81Outperform
Price Target:
$85.00
â–²(8.78% Upside)
Action:UpgradedDate:02/20/26
Score is driven mainly by strong financial resilience (no/low leverage, high profitability) and supportive earnings-call fundamentals (large cash position, low breakeven, strong bookings). Valuation is also attractive with a low P/E and a moderate dividend yield. The primary offsets are cyclical pressure signs (recent revenue decline and cash-flow normalization) and near-term technical overheating (very high RSI/Stoch).
Positive Factors
Very Low Leverage / Strong Balance Sheet
Debt-to-equity near 0.03 and a meaningful equity cushion materially reduce financial risk and increase resilience across shipping cycles. Low leverage preserves flexibility to fund maintenance, opportunistic vessel purchases, dividends, or buybacks without relying on market financing during downturns.
Large Liquidity & Positive FCF
A substantial cash balance with positive free cash flow supports durable shareholder returns and capital allocation optionality. This liquidity enables steady dividends, selective fleet renewal, and the ability to absorb spot-rate volatility without forced asset sales or dilutive financing.
Low FCF Breakeven / High Operating Leverage
A substantially reduced breakeven rate increases earnings sensitivity to rate improvements and limits downside under typical rate environments. Structural operating leverage means incremental market improvements generate outsized free cash flow, supporting long-term capital returns and reinvestment.
Negative Factors
Recent Revenue Contraction
Sustained revenue declines highlight exposure to shipping-cycle reversals; persistent softer top line can compress margins and limit free cash flow despite operational strength. Over 2–6 months, weaker voyage volumes or rate normalization would pressure earnings and capital-return capacity.
High Spot Exposure & Market Volatility
Reliance on spot employment increases revenue volatility versus time-charter peers. Geopolitical shifts or the unwinding of sanctions-driven re-routing could quickly reduce demand for compliant spot tonnage, eroding the very rate spikes that drive profitability and FCF.
Rising Supply Risk / Fleet Replacement Uncertainty
An elevated order book implies notable vessel deliveries into 2026–2027, risking rate dilution if scrapping or dark fleet migration doesn’t offset supply. Combined with an older average fleet and uncertain replacement timing, this creates medium-term supply-demand uncertainty for rates and earnings.
Teekay Tankers (TNK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.70B
Dividend Yield3.72%
Average Volume (3M)443.44K
Price to Earnings (P/E)7.8
Beta (1Y)0.76
Revenue Growth-20.11%
EPS Growth-26.44%
CountryUS
Employees2,330
SectorEnergy
Sector Strength52
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)2.80
Shares Outstanding29,912,968
10 Day Avg. Volume648,996
30 Day Avg. Volume443,437
Financial Highlights & Ratios
PEG Ratio-0.40
Price to Book (P/B)0.90
Price to Sales (P/S)1.94
P/FCF Ratio16.41
Enterprise Value/Market Cap0.71
Enterprise Value/Revenue2.02
Enterprise Value/Gross Profit7.34
Enterprise Value/Ebitda4.74
Forecast
1Y Price Target
$76.50Price Target Upside-2.10% Downside
Rating ConsensusHold
Number of Analyst Covering2
EPS Forecast (FY)8.8
Revenue Forecast (FY)$681.00M
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
Revenue by Segment
Breaks down earnings from different business areas, highlighting which segments are driving growth and profitability, and where the company might face challenges.
Breaks down earnings from different business areas, highlighting which segments are driving growth and profitability, and where the company might face challenges.
Data provided by:
The Fly
The FlyTeekay Tankers Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 07, 2026
Earnings Call Sentiment Positive
Overall the call conveyed a positive tone: strong quarterly and annual earnings, robust free cash flow generation, a large cash balance and no debt, high spot rates and strong booking metrics, plus active fleet renewal and operational excellence. Noted headwinds include market volatility, an elevated order book (near 10-year high as a % of fleet), and timing uncertainty around fleet replacements and deliveries. Management expects selective, opportunistic fleet additions rather than large M&A given current asset valuations. On balance the highlights materially outweigh the risks discussed.Q4-2025 Updates
Positive Updates
Strong Quarterly and Annual Earnings
Q4 GAAP net income of $120M ($3.47/share) and adjusted net income of $97M ($2.80/share). Full-year GAAP net income $351M ($10.15/share) and adjusted net income $241M ($6.96/share).
Robust Free Cash Flow and Cash Position
Generated approximately $112M in free cash flow from operations in Q4 and $309M for the full year. Cash on hand at quarter end was $853M (excludes $99M escrow); company has no debt.
Exceptional Spot Market Performance and Bookings
Spot tanker rates were the second-highest Q4 in 15 years. Secured spot rates to date of ~$79,800/day (VLCC), ~$56,900/day (Suezmax) and ~$51,400/day (Aframax LR2). VLCC ~78% spot days booked and midsized fleet ~65% spot days booked.
Fleet Renewal and Realized Gains
Acquired 6 vessels for $300M and sold 14 vessels for $500M in 2025, booking estimated gains of ~$145M. Recent deals: three 2016 Aframaxes purchased for $142M (bareboat chartered back), two older Suezmaxes sold for $73M, and a VLCC sale for $84.5M (delivery Q2). Expect to recognize ~ $45M of gains in Q1/Q2 2026 from recent sales.
Low Free Cash Flow Breakeven and High Operating Leverage
Low free cash flow breakeven of approximately $11,300/day (down from $21,300/day in 2022, ~47% reduction). Each $5,000/day increase above breakeven expected to produce ~ $55M annual FCF or ~$1.60/share.
Capital Returns and Dividends
Declared regular fixed dividend of $0.25/share. Returned approximately $69M of capital to shareholders in 2025 (regular quarterly dividends plus $1 special in May).
Operational and Safety Performance
0 lost time injuries and 99.8% fleet availability in 2025, underlining strong operational reliability.
Strategic Financial Flexibility
No debt and large liquidity ($853M cash) provides capacity to act opportunistically in a dynamic market; management expects selective 'drip-feed' acquisitions rather than large M&A given elevated asset values.
Negative Updates
Market Volatility and Geopolitical Uncertainty
Tanker market remains volatile and influenced by geopolitical events (sanctions, terminal disruptions, regional tensions). Management cautioned that rate spikes tied to such events may be short-lived if flows are not disrupted, adding uncertainty to near-term rate sustainability.
Elevated Order Book and Future Supply Risk
Tanker order book at a ~10-year high when measured as a percentage of the fleet (management referenced ~18% of fleet on order), implying increased deliveries in 2026–2027 that could pressure rates depending on timing of vessel exits/scrapping.
Timing Uncertainty of Fleet Replacement
Average fleet age is the highest in over 30 years, which creates replacement demand but the timing of removals (scrapping or migration to dark fleet) is uncertain — a source of medium-term supply-demand uncertainty.
High Asset Values Constrain Major Acquisitions
Management noted elevated asset values following the market rally, making large acquisitions less likely; plan is for selective smaller purchases, potentially limiting rapid fleet expansion.
Dependence on Sanctions-Driven Trade Patterns
A meaningful portion of current demand upside is linked to re-routing of sanctioned barrels toward the compliant fleet (sanctioned barrels at sea reportedly rose >70% year-over-year). If sanction patterns or trade deals shift, this supportive demand could change.
Uncertain Shareholder Special Dividend Outcome
While a regular $0.25 dividend was declared, management reiterated that any special dividend is Board-dependent (historically announced in May), so special payouts remain uncertain.
Company Guidance
Teekay's guidance emphasized returning capital and opportunistic, selective deployment of cash: the board declared the regular dividend of $0.25/share (specials typically decided with the March board and announced with the May release), Q1‑to‑date spot rates secured were ~$79,800/day (VLCC), $56,900/day (Suezmax) and $51,400/day (Aframax LR2) with ~78% VLCC spot days and ~65% midsize spot days, the company holds $853M cash (ex‑$99M escrow) with no debt, has a low FCF breakeven of ~$11,300/day (down from $21,300 in 2022) where each $5,000/day above breakeven generates ~ $55M of annual FCF (~$1.60/share), expects to recognize roughly $45M of vessel‑sale gains in Q1–Q2 2026 (recent grosses included $84.5M VLCC and $73M for two Suezmaxes), plans Q1 D&A of about $21.5–22M and a G&A run‑rate near $46M (or lower), and will continue renewing the fleet via small bolt‑on purchases rather than large M&A.Teekay Tankers Financial Statement Overview
Summary
Strong overall fundamentals led by a very low-leverage balance sheet (2025 debt-to-equity ~0.03) and sustained high profitability (2025 net margin ~37%). Offsetting factors are contracting revenue in 2024–2025, margin normalization from 2023 peaks, and weaker cash conversion in 2025 versus 2024, consistent with cyclical earnings risk.Income Statement
Profitability is strong in the last several years, with net margins remaining very high in 2023–2025 (2025: ~37%) and solid operating profitability (2025 EBIT margin ~23%). However, the top line has been contracting recently (revenue down ~9% in 2025 after a modest decline in 2024), and margins have compressed from the 2023 peak, suggesting earnings are likely sensitive to a softer rate environment. The earlier cycle downturn is also evident (large loss in 2021), highlighting volatility.78
Positive
Balance Sheet
The balance sheet is a clear strength: leverage has been dramatically reduced from 2021–2022 levels to very low debt relative to equity by 2024–2025 (2025 debt-to-equity ~0.03). Equity has grown meaningfully, supporting a strong capital cushion, and returns on equity remain healthy (2025 ~17%) though down from 2023–2024, consistent with normalization in profitability. Overall financial risk from debt appears limited.90
Very Positive
Cash Flow
Cash generation remains positive, with operating cash flow solid in 2025 (~$306M) and free cash flow positive (~$113M) with growth in 2025 (~13%). That said, cash flow has cooled from the exceptionally strong 2023–2024 period (notably lower free cash flow in 2025 versus 2024), and free cash flow is a smaller share of net income in 2025 (about 37%), implying weaker cash conversion than the prior two years. The business also showed vulnerability in 2021 when operating and free cash flow were negative.74
Positive
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 951.80M | 1.23B | 1.47B | 1.18B | 542.37M |
| Gross Profit | 261.58M | 394.30M | 581.67M | 305.97M | -58.01M |
| EBITDA | 301.64M | 505.13M | 657.75M | 372.45M | -103.19M |
| Net Income | 351.19M | 403.67M | 519.89M | 235.43M | -242.37M |
Balance Sheet | |||||
| Total Assets | 2.24B | 1.97B | 1.94B | 1.78B | 1.62B |
| Cash, Cash Equivalents and Short-Term Investments | 853.26M | 534.33M | 391.46M | 180.51M | 50.57M |
| Total Debt | 55.22M | 62.29M | 224.68M | 576.20M | 654.03M |
| Total Liabilities | 198.06M | 217.42M | 391.51M | 713.65M | 780.34M |
| Stockholders Equity | 2.04B | 1.76B | 1.55B | 1.07B | 838.41M |
Cash Flow | |||||
| Free Cash Flow | 112.64M | 396.57M | 615.87M | 177.84M | -128.76M |
| Operating Cash Flow | 305.89M | 471.91M | 626.07M | 193.26M | -107.31M |
| Investing Cash Flow | 78.34M | -5.11M | 17.26M | 51.22M | 38.14M |
| Financing Cash Flow | -68.53M | -343.40M | -464.75M | -113.05M | 21.95M |
Teekay Tankers Technical Analysis
Positive
78.14
Price Trends
62.77
Positive
59.74
Positive
52.96
Positive
Market Momentum
4.07
Negative
80.60
Negative
83.37
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 78.14 is above the 20-day moving average (MA) of 70.44, above the 50-day MA of 62.77, and above the 200-day MA of 52.96, indicating a bullish trend. The MACD of 4.07 indicates Negative momentum. The RSI at 80.60 is Negative, neither overbought nor oversold. The STOCH value of 83.37 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
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $4.05B | 10.69 | 11.35% | 3.19% | -35.37% | -57.86% | |
81 Outperform | $2.70B | 7.75 | 18.48% | 3.72% | -20.11% | -26.44% | |
79 Outperform | $1.39B | 14.00 | 8.57% | 1.27% | 2.46% | 33.89% | |
76 Outperform | $1.61B | 13.29 | 11.21% | 13.08% | -27.21% | -62.22% | |
74 Outperform | $3.15B | 14.84 | 19.44% | 6.12% | -16.45% | 23.94% | |
69 Neutral | $3.78B | 12.11 | 15.96% | 6.12% | -23.59% | -57.70% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% |
* Energy Sector Average
TNK
Teekay Tankers
78.14
40.78
109.13%
DHT
DHT Holdings
19.65
9.62
96.01%
STNG
Scorpio Tankers
78.28
40.31
106.14%
NVGS
Navigator Holdings
21.25
6.98
48.95%
LPG
Dorian LPG
37.64
18.94
101.24%
INSW
International Seaways
76.50
44.47
138.87%
Teekay Tankers Corporate Events
Teekay Tankers Posts Strong 2025 Results and Accelerates Fleet Renewal
Feb 18, 2026
Teekay Tankers reported strong financial results for the fourth quarter and full year 2025 on February 18, 2026, posting GAAP net income of $120.5 million, or $3.47 per share, in the quarter and $351.2 million, or $10.15 per share, for the year. Adjusted net income reached $97.0 million in the fourth quarter and $240.8 million for 2025, supported by robust spot tanker rates and enhanced by the retroactive consolidation of its acquired Australian operations under common control accounting.
Operationally, the company continued its fleet renewal strategy by purchasing three 2016-built Aframax tankers for $141.5 million, which are bareboat chartered back on short‑term contracts into 2026, while selling or agreeing to sell three older Suezmax and VLCC vessels for $157.5 million in gross proceeds. Teekay Tankers also strengthened its balance sheet, growing cash and short‑term investments to $853.3 million by year‑end 2025, and declared a cash dividend of $0.25 per share for the quarter ended December 31, 2025, underscoring its improved earnings power and shareholder returns amid firming spot market conditions into early 2026.
The most recent analyst rating on (TNK) stock is a Hold with a $70.00 price target. To see the full list of analyst forecasts on Teekay Tankers stock, see the TNK Stock Forecast page.
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.