Trade-Ideas LLC identified

Scorpio Tankers

(

STNG

) as a strong on high relative volume 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 $12.5 million.
  • STNG has traded 379,656 shares today.
  • STNG is trading at 2.98 times the normal volume for the stock at this time of day.
  • STNG is trading at a new high 9.11% above yesterday's close.

'Strong on High Relative Volume' stocks are worth watching because major volume moves tend to indicate underlying activity such as M&A events, material stock news, analyst upgrades, insider buying, buying from 'superinvestors,' or that hedge funds and momentum traders are piling into a stock ahead of a catalyst. Regardless of the impetus behind the price and volume action, when a stock moves with strength and volume it can indicate the start of a new trend on which early investors can capitalize. In the event of a well-timed trading opportunity, combining technical indicators with fundamental trends and a disciplined trading methodology should help you take the first steps towards investment success.

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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 8.6%. STNG has a PE ratio of 5. Currently there are 7 analysts that rate Scorpio Tankers a buy, no analysts rate it a sell, and 2 rate 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 $1.0 billion and is part of the services sector and transportation industry. The stock has a beta of 1.69 and a short float of 6.7% with 5.08 days to cover. Shares are down 28.8% year-to-date as of the close of trading on Friday.

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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 robust revenue growth, notable return on equity and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and generally higher debt management risk.

Highlights from the ratings report include:

  • STNG's very impressive revenue growth greatly exceeded the industry average of 33.0%. Since the same quarter one year prior, revenues leaped by 175.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • SCORPIO TANKERS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, SCORPIO TANKERS INC increased its bottom line by earning $0.27 versus $0.14 in the prior year. This year, the market expects an improvement in earnings ($1.23 versus $0.27).
  • The debt-to-equity ratio of 1.44 is relatively high when compared with the industry average, suggesting a need for better debt level management. Even though the debt-to-equity ratio is weak, STNG's quick ratio is somewhat strong at 1.19, demonstrating the ability to handle short-term liquidity needs.
  • STNG's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 31.57%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.

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