Cleaves Bullish on Rates as Scorpio Tankers Coverage Begins
November 3, 2023
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Supercycling analyst Cleaves is optimistic about the outlook of Scorpio Tankers ($NYSE:STNG)’ rates as coverage begins. With this, coverage has officially started and the new research report from Cleaves has marked this milestone. Scorpio Tankers Inc. is a leading provider of marine transportation of crude oil and petroleum products worldwide. The company’s vessels are capable of carrying a range of refined products, such as gasoline, diesel, jet fuel, heating oil, and more. This type of fuel is increasingly used in the shipping industry due to environmental regulations. The company has also taken steps to reduce its emissions through the installation of exhaust gas cleaning systems on its vessels.
Cleaves believes that Scorpio Tankers is well-positioned to benefit from a potential rebound in tanker rates. With the current low level of shipping activity, not all of its vessels are in operation, which could lead to greater efficiency and cost savings. Furthermore, the company is well-positioned to capitalize on any recovery in the market given its diversified portfolio of vessels. With these factors in mind, Cleaves is confident that Scorpio Tankers will be able to outperform its peers as coverage begins.
Stock Price
On Monday, SCORPIO TANKERS, a global shipping company, opened its stock at $57.8 and closed at $56.3, which is down by 2.5% from its previous closing price of 57.7. This slight downturn in stock prices has not deterred bullish sentiment among analysts. Cleaves, a research firm noted for its expertise on the sector, recently initiated coverage on SCORPIO TANKERS with a strong buy rating.
The company appears to remain optimistic about rates in the tanker market, believing that the current market conditions are conducive to growth and profitability. It is clear that the company has faith in its products and services, and believes there is great potential for further success in the near future. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Scorpio Tankers. More…
| Total Revenues | Net Income | Net Margin |
| 1.7k | 856.21 | 49.9% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Scorpio Tankers. More…
| Operations | Investing | Financing |
| 1.13k | 41.25 | -1.22k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Scorpio Tankers. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 4.32k | 1.9k | 43.82 |
Key Ratios Snapshot
Some of the financial key ratios for Scorpio Tankers are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 21.0% | 44.9% | 59.9% |
| FCF Margin | ROE | ROA |
| 65.1% | 25.5% | 14.7% |
Analysis
As GoodWhale, we performed an analysis of SCORPIO TANKERS to evaluate their wellbeing. Our Star Chart analysis gave SCORPIO TANKERS a health score of 8/10, which indicates that they are capable of paying off debt and funding future operations. Additionally, our categorization of SCORPIO TANKERS as a “cheetah” indicates that the company has achieved high revenue or earnings growth but is considered less stable due to lower profitability. Given these factors, we conclude that investors interested in SCORPIO TANKERS may be particularly attracted to its ability to generate dividends and growth while also providing medium levels of asset and profitability. Such investors may include those looking for high-growth companies with the potential to generate significant returns in the future. More…
Peers
Scorpio Tankers Inc is one of the largest tanker shipping companies in the world. Founded in 2009, the company is headquartered in Monaco. Scorpio Tankers Inc has a fleet of over 100 tankers and operates in over 30 countries. The company’s main competitors are TORM PLC, Petro Times JSC, and Pilipinas Shell Petroleum Corp.
– TORM PLC ($LTS:0RG4)
In 2022, Dorman Products, Inc. had a market capitalization of $16.22 billion and a return on equity of 17.86%. Dorman Products, Inc. is a leading supplier of original equipment dealer “exclusive” automotive and heavy duty replacement parts, automotive hardware, brake parts, and fasteners to the automotive aftermarket.
– Petro Times JSC ($HNX:PPT)
Pilipinas Shell Petroleum Corporation is a publicly listed company in the Philippines with a market capitalization of 28.95 billion as of 2022. The company is engaged in the business of refining, marketing, and distributing petroleum products in the Philippines. The company has a return on equity of 17.04%.
Summary
Investment analysis of Scorpio Tankers shows a bullish outlook on rates. This assessment is based on the recent initiation of coverage by Cleaves, a professional investor. This positive outlook is backed by the potential of Scorpio Tankers’ specialized niche of oil and gas transportation, as well as its reliable fleet of vessels. Analysts note that Scorpio Tankers has been able to capitalize on the industry’s rise in demand for fuel shipments in recent years.
Despite a few minor risks, such as volatile energy prices, Scorpio Tankers overall presents an attractive investment opportunity. Investors should keep a close eye on Scorpio Tankers’ performance and adjust their portfolio accordingly.
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