Scorpio Tankers (NYSE:STNG) Announces Quarterly Earnings Results

Scorpio Tankers (NYSE:STNG) released its quarterly earnings data on Thursday. The shipping company reported $4.68 EPS for the quarter, missing the consensus estimate of $5.14 by ($0.46), Zacks reports. Scorpio Tankers had a net margin of 48.44% and a return on equity of 11.72%. The business’s quarterly revenue was up 77.5% compared to the same quarter last year. During the same quarter in the prior year, the company posted $1.41 EPS.

Here are the key takeaways from Scorpio Tankers’ conference call:

• Record quarterly performance: Scorpio Tankers generated $300.5 million of adjusted EBITDA and $243.7 million of adjusted net income, while product tanker rates remained above $30,000 per day despite seasonal volume declines.
• Balance sheet and funding strengthened: Cash reached more than $1.9 billion, while low-cost convertible financing replaced higher-cost debt. Net debt has declined by $4.2 billion since 2021 to a net cash position of approximately $1.3 billion, and cash breakeven is below $11,000 per day.
• Shareholder returns continued: The company repurchased approximately $155 million of stock and declared a $0.45 quarterly dividend, returning more than $175 million to shareholders during the quarter.
• Management sees supportive long-term tanker fundamentals: Refinery capacity is increasingly located far from consumers, inventories have been drawn down, and rerouting and geopolitical disruptions are increasing ton-mile demand. An aging and sanctioned fleet, along with LR2 vessels trading in the crude market, is expected to keep effective product-tanker supply growth below the headline order book.
• Market conditions remain volatile and strategically flexible: Freight rates have moderated from early-year records, and the company does not expect geopolitical uncertainty to be predictable. Scorpio is moving some LR2s between clean and crude trades based on relative earnings and has approximately $978 million of remaining newbuilding and joint-venture commitments.

Scorpio Tankers Stock Down 2.0%

Shares of NYSE STNG traded down $1.59 during trading hours on Thursday, hitting $76.94. 469,624 shares of the stock were exchanged, compared to its average volume of 1,064,707. Scorpio Tankers has a 12 month low of $43.78 and a 12 month high of $87.39. The firm has a fifty day moving average price of $77.03 and a 200-day moving average price of $73.87. The company has a quick ratio of 13.87, a current ratio of 13.98 and a debt-to-equity ratio of 0.16. The company has a market cap of $3.88 billion, a PE ratio of 7.56 and a beta of -0.24.

Scorpio Tankers Dividend Announcement

The company also recently disclosed a quarterly dividend, which was paid on Monday, June 15th. Stockholders of record on Friday, May 29th were given a $0.45 dividend. The ex-dividend date of this dividend was Friday, May 29th. This represents a $1.80 dividend on an annualized basis and a dividend yield of 2.3%. Scorpio Tankers’s payout ratio is presently 17.70%.

Wall Street Analyst Weigh In

A number of brokerages recently commented on STNG. BTIG Research increased their price target on Scorpio Tankers from $85.00 to $100.00 and gave the company a “buy” rating in a research note on Tuesday, May 5th. Evercore reaffirmed an “outperform” rating and set a $94.00 price objective on shares of Scorpio Tankers in a report on Wednesday, July 22nd. Wall Street Zen lowered shares of Scorpio Tankers from a “strong-buy” rating to a “buy” rating in a report on Tuesday, July 14th. Bank of America cut shares of Scorpio Tankers from a “buy” rating to an “underperform” rating and reduced their price target for the stock from $100.00 to $78.00 in a research report on Tuesday, June 30th. Finally, Morgan Stanley set a $82.00 price target on shares of Scorpio Tankers and gave the company an “equal weight” rating in a research note on Thursday, July 9th. One investment analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating, four have given a Hold rating and one has assigned a Sell rating to the stock. According to data from MarketBeat.com, Scorpio Tankers currently has a consensus rating of “Moderate Buy” and an average price target of $88.14.

Hedge Funds Weigh In On Scorpio Tankers

Large investors have recently made changes to their positions in the business. XTX Topco Ltd boosted its position in shares of Scorpio Tankers by 391.3% in the 4th quarter. XTX Topco Ltd now owns 37,100 shares of the shipping company’s stock worth $1,886,000 after purchasing an additional 29,548 shares in the last quarter. Voloridge Investment Management LLC purchased a new stake in shares of Scorpio Tankers during the fourth quarter worth about $4,864,000. Twinbeech Capital LP acquired a new position in shares of Scorpio Tankers during the fourth quarter valued at about $351,000. Quadrature Capital Ltd purchased a new position in shares of Scorpio Tankers in the 4th quarter valued at approximately $243,000. Finally, Oxford Asset Management LLP acquired a new stake in Scorpio Tankers in the 4th quarter worth approximately $290,000. 54.64% of the stock is owned by institutional investors and hedge funds.

About Scorpio Tankers

Scorpio Tankers Inc (NYSE: STNG) is an independent provider of marine transportation services, specializing in the carriage of refined petroleum products. The company’s core operations focus on moving clean petroleum cargoes—such as gasoline, diesel, jet fuel and naphtha—on a global scale. By catering to both spot and time charter markets, Scorpio Tankers enables energy companies, refiners and traders to manage their supply chains with flexibility and reliability.

The company’s fleet is composed of modern, eco-designed product tankers, including medium range (MR) and long range (LR) vessels.