Stock in Focus: Scorpio Tankers Inc. (STNG)

Company Profile:

Scorpio 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.

Recent News:

On Oct. 06, 2022, the compnay announced that it has purchased its common shares in the open market. The Company purchased 379,845 of its common shares in the open market at an average price of $39.77 per share as part of the Company’s securities repurchase program.

For the second quarter of 2022, the Company’s GAAP net income was $52.7 million, or $1.36 per diluted share, including a gain of approximately $28.3 million and cash dividend income of $0.2 million, or $0.73 per diluted share.

The Company announced that on August 3, 2022 its Board of Directors declared a quarterly cash dividend of $0.01 per share on the Company’s common shares.

Fundamental Analysis:

Ninestocks analyzes several different financial aspects:

Price to Book Value – P/BV, a ratio used to compare book value to its current market price, to gauge whether a stock is valued properly.

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Price to Earnings – PE, the ratio for valuing a company that measures its current share price relative to its earnings per share (EPS).

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Discounted cash flow – DCF, a valuation method used to estimate the value of an investment based on its expected future cash flows.

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Return on Assets – ROA, indicates how profitable a company is in relation to its total assets, how efficiently uses assets to generate a profit.

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Return on Equity – ROE, a measure of financial performance calculated by dividing net income by equity. a gauge of profitability and efficiency.

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Debt to Equity – evaluate financial leverage, reflects the ability of equity to cover outstanding debts in the event of a business downturn.

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Conclusion:

STNG receives outperform rating in price to book value, price to earnings, discounted cash flow and debt to equity. Technical indicators signal the bullish signs, as there is a bullish crossover in the stochastic oscillator, the MACD is trying to cross back up and the RSI(14) stands at 51.3 with positive bias. We rate Scorpio Tankers Inc. (STNG) a BUY.