Trade-Ideas LLC identified

Scorpio Tankers

(

STNG

) as a "dead cat bounce" (down big yesterday but up big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Scorpio Tankers as such a stock due to the following factors:

  • STNG has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $13.5 million.
  • STNG has traded 66,482 shares today.
  • STNG is up 4.8% today.
  • STNG was down 6.3% yesterday.

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More details on STNG:

Scorpio Tankers Inc., together with its subsidiaries, engages in the seaborne transportation of refined petroleum products and crude oil worldwide. The stock currently has a dividend yield of 10.8%. STNG has a PE ratio of 3. Currently there are 7 analysts that rate Scorpio Tankers a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Scorpio Tankers has been 2.6 million shares per day over the past 30 days. Scorpio Tankers has a market cap of $801.2 million and is part of the services sector and transportation industry. The stock has a beta of 1.46 and a short float of 7.1% with 3.81 days to cover. Shares are down 42.3% year-to-date as of the close of trading on Tuesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Scorpio Tankers as a

hold

. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

Highlights from the ratings report include:

  • The revenue growth came in higher than the industry average of 24.0%. Since the same quarter one year prior, revenues slightly increased by 2.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. In comparison to the other companies in the Oil, Gas & Consumable Fuels industry and the overall market, SCORPIO TANKERS INC's return on equity significantly exceeds that of the industry average and is above that of the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 57.39%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 32.00% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • The debt-to-equity ratio of 1.41 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, STNG maintains a poor quick ratio of 0.87, which illustrates the inability to avoid short-term cash problems.

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