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1. Company Snapshot

1.a. Company Description

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.

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1.b. Last Insights on STNG

Scorpio Tankers' recent performance was driven by strong Q2 2025 earnings, with quarterly earnings of $1.41 per share beating estimates. A time charter-out agreement and an update on daily TCE rates also boosted investor confidence. Additionally, a recent analyst upgrade from a well-known bank contributed to the positive momentum. The company's plan to sell its 2020-built scrubber-fitted MR product tanker, STI Maestro, for $42.0 million is expected to close within Q4 2025. A quarterly cash dividend of $0.40 per share was also declared.

1.c. Company Highlights

2. Scorpio Tankers Delivers Robust Financial Performance in 2024

Scorpio Tankers reported strong financial results for the fourth quarter and full-year 2024, underscoring its operational efficiency and strategic initiatives. For Q4, the company generated $105 million in adjusted EBITDA and $30 million in adjusted net income, while the full year saw $842 million in adjusted EBITDA and $513 million in adjusted net income. These figures reflect the company's ability to capitalize on favorable market conditions and its focus on deleveraging, with debt reduced by $740 million during the year. Scorpio Tankers' liquidity position remains robust at $1.3 billion, comprising $531 million in cash and $788 million in undrawn revolving capacity, positioning it well to navigate market volatility.

Publication Date: Feb -27

📋 Highlights
  • Strong Financial Performance:: Scorpio Tankers delivered robust Q4 and full-year 2024 results, with $105 million in adjusted EBITDA and $30 million in adjusted net income for Q4, and $842 million in adjusted EBITDA and $513 million in adjusted net income for the full year, underscoring operational and financial strength.
  • Balance Sheet Optimization:: The company significantly reduced debt by $740 million, expanded its revolving debt capacity, and lowered daily cash breakevens to $12,500. Liquidity stands at $1.3 billion, comprising $531 million in cash and $788 million in undrawn revolving capacity, excluding investments in DHT.
  • Operational Efficiency and Shareholder Returns:: Scorpio completed special surveys and dry docking for 54 vessels in 2024, improving efficiency. Twelve vessels were sold at attractive prices, enhancing the fleet's age profile. The company returned $419 million to shareholders through share repurchases and dividends.
  • Positive Market Outlook:: The market for crude oil and refined products remains constructive, driven by strong demand, low inventories, and an aging fleet. Demand for refined products is expected to grow by nearly one million barrels per day, with ton-mile demand increasing 15% (excluding Russia) and 18% (including Russia) compared to 2019 levels.
  • Strategic Investments and Financial Flexibility:: Scorpio increased its stake in DHT, capitalizing on share price lag amid improving market fundamentals. The company emphasized its strong financial position, with low leverage, significant liquidity, and a young fleet, positioning it well to thrive under any rate environment. Management highlighted the ability to act opportunistically while maintaining financial flexibility.

Operational Excellence and Shareholder Returns

Operationally, Scorpio Tankers completed special surveys and dry docking for 54 vessels in 2024, enhancing fleet efficiency and reducing repositioning voyages. The company also sold 12 vessels at attractive prices, improving its fleet's age profile. Shareholder returns were a key focus, with $419 million returned through $336 million in share repurchases and $84 million in dividends. Additionally, Scorpio Tankers increased its stake in DHT Holdings, leveraging the share price lag amid improving market fundamentals. Robert Bugbee, President and CEO, noted, "Our strategic investments and disciplined capital allocation position us to capitalize on the improving tanker market dynamics."

Market Outlook and Valuation Analysis

The market outlook for both crude oil and refined products remains positive, driven by strong demand, low global inventories, and an aging fleet. Demand for refined products is expected to grow by nearly one million barrels per day, with ton-mile demand increasing 15-18% compared to 2019 levels. Geopolitical developments, including sanctions and shifting trade flows, further support a favorable supply-demand balance for non-sanctioned vessels. Scorpio Tankers' strong financial position, with low leverage and significant liquidity, underscores its resilience. The company's enterprise value-to-EBITDA ratio of 2.79 and free cash flow yield of 41.08% highlight its attractive valuation relative to peers.

Strategic Positioning and Future Catalysts

Scorpio Tankers' strategic initiatives, including a record-breaking Nordic bond issuance, have further strengthened its balance sheet and credit profile. The company's manageable debt repayment obligations and lighter dry docking schedule in 2025 position it for sustained efficiency and cash flow generation. With operating leverage poised to benefit from spot rate spikes, Scorpio Tankers is well-positioned to thrive in various rate environments. The potential reopening of the Red Sea and favorable refinery realignments present additional catalysts for growth, as the company remains focused on deleveraging and maintaining low cash breakevens.

3. NewsRoom

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Scorpio Tankers Sees Unusually Large Options Volume (NYSE:STNG)

Nov -29

Source: defenseworld.net

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Donald Smith & Co's Strategic Moves: Honda Motor Co Ltd Takes Center Stage

Nov -25

Source: gurufocus.com

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Scorpio Tankers Inc. $STNG Shares Acquired by Allworth Financial LP

Nov -17

Source: defenseworld.net

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Scorpio Tankers Inc. Announces Agreements to Construct VLCCs

Nov -11

Source: globenewswire.com

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CSE Bulletin: New Listing - Stinger Resources Inc. (STNG)

Nov -06

Source: newsfilecorp.com

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Scorpio Tankers Inc. Announces Agreements to Sell Four MR Product Tankers and to Purchase Four MR Newbuilding Vessels

Nov -06

Source: globenewswire.com

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Stinger Resources Inc. Announces CSE Listing and TSXV Delisting

Nov -05

Source: newsfilecorp.com

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Scorpio Tankers: Entering A Mature Phase With Stable Dividends Ahead

Nov -05

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.83%)

6. Segments

Medium Range

Expected Growth: 4.83%

Scorpio Tankers Inc.'s medium-range growth of 4.83% is driven by increasing demand for oil transportation, rising crude oil prices, and a growing global economy. Additionally, the company's modern fleet and cost-cutting initiatives contribute to its growth. Furthermore, Scorpio's focus on acquiring and operating fuel-efficient vessels also supports its growth momentum.

Long Range 2

Expected Growth: 4.83%

Scorpio Tankers Inc.'s Long Range 2 segment growth of 4.83% is driven by increasing global oil demand, rising crude oil prices, and a growing need for energy transportation. Additionally, the company's modern fleet and operational efficiency contribute to its growth, along with a strong balance sheet and strategic acquisitions.

Handymax

Expected Growth: 4.83%

Scorpio Tankers' Handymax segment growth of 4.83% is driven by increasing demand for oil products transportation, particularly in the Asian market. Rising refining capacity, infrastructure development, and growing energy demand in emerging markets also contribute to this growth. Additionally, the company's modern fleet and operational efficiency enable it to capitalize on these trends.

7. Detailed Products

Product Tankers

Scorpio Tankers Inc. operates a fleet of product tankers that transport refined petroleum products such as gasoline, diesel fuel, and jet fuel.

Crude Tankers

The company's crude tankers transport unrefined crude oil from production sites to refineries.

LR1 and LR2 Tankers

Scorpio Tankers operates a fleet of LR1 and LR2 tankers that transport petroleum products and crude oil.

Ice-Class Tankers

The company's ice-class tankers are designed to operate in harsh, icy environments and transport petroleum products in Arctic regions.

Chartering Services

Scorpio Tankers offers chartering services to other companies, providing access to its fleet of tankers.

8. Scorpio Tankers Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Scorpio Tankers Inc. operates in a niche market with limited substitutes, but the increasing adoption of alternative fuels and energy-efficient technologies poses a moderate threat.

Bargaining Power Of Customers

Scorpio Tankers Inc. has a diverse customer base, and no single customer has significant bargaining power, reducing the threat of customer bargaining power.

Bargaining Power Of Suppliers

Scorpio Tankers Inc. relies on a few major suppliers for its operations, giving them some bargaining power, but the company's scale and diversification mitigate this threat.

Threat Of New Entrants

The capital-intensive nature of the tanker industry, combined with regulatory barriers, makes it difficult for new entrants to join the market, reducing the threat of new entrants.

Intensity Of Rivalry

The tanker industry is highly competitive, with many established players, leading to intense rivalry and pricing pressure on Scorpio Tankers Inc.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 34.86%
Debt Cost 4.78%
Equity Weight 65.14%
Equity Cost 4.78%
WACC 4.78%
Leverage 53.53%

11. Quality Control: Scorpio Tankers Inc. passed 8 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Teekay Tankers

A-Score: 6.9/10

Value: 7.3

Growth: 8.2

Quality: 7.5

Yield: 7.0

Momentum: 6.5

Volatility: 5.0

1-Year Total Return ->

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Stock-Card
International Seaways

A-Score: 6.7/10

Value: 7.2

Growth: 8.2

Quality: 7.4

Yield: 10.0

Momentum: 2.0

Volatility: 5.7

1-Year Total Return ->

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TORM

A-Score: 6.4/10

Value: 7.7

Growth: 6.9

Quality: 6.6

Yield: 10.0

Momentum: 5.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
Scorpio Tankers

A-Score: 6.2/10

Value: 7.3

Growth: 8.3

Quality: 7.5

Yield: 5.6

Momentum: 6.0

Volatility: 2.3

1-Year Total Return ->

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Stock-Card
Vopak

A-Score: 6.0/10

Value: 5.7

Growth: 4.6

Quality: 6.3

Yield: 7.5

Momentum: 3.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
Euronav

A-Score: 4.7/10

Value: 5.2

Growth: 6.9

Quality: 5.4

Yield: 5.0

Momentum: 4.0

Volatility: 1.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

56.14$

Current Price

56.15$

Potential

-0.00%

Expected Cash-Flows