For the first quarter Scorpio Tankers posted earnings of 1 cent a share, missing the Capital IQ Consensus Estimate of 3 cents a share by 2 cents. Revenue grew 70.8% from the year-ago quarter to $76.7 million, beating the consensus estimate of $74.84 million.
The earnings include a gain of $51.4 million, or 27 cents a share, from the sale of seven Very Large Crude Carriers under construction.
TheStreet Ratings team rates SCORPIO TANKERS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate SCORPIO TANKERS INC (STNG) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and impressive record of earnings per share growth. However, as a counter to these strengths, we find that the company's profit margins have been poor overall."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- STNG's very impressive revenue growth greatly exceeded the industry average of 7.5%. Since the same quarter one year prior, revenues leaped by 77.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
- STNG's debt-to-equity ratio is very low at 0.12 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 2.50, which clearly demonstrates the ability to cover short-term cash needs.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, SCORPIO TANKERS INC's return on equity significantly trails that of both the industry average and the S&P 500.
- The gross profit margin for SCORPIO TANKERS INC is currently extremely low, coming in at 6.63%. It has decreased significantly from the same period last year. Regardless of the weak results of the gross profit margin, the net profit margin of 10.81% is above that of the industry average.
- You can view the full analysis from the report here: STNG Ratings Report
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.