Scorpio Tankers Inc. Stock Upgraded (STNG)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK ( TheStreet) -- Scorpio Tankers (NYSE: STNG) has been upgraded by TheStreet Ratings from sell to hold. 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 solid stock price performance. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow.

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Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 1.5%. Since the same quarter one year prior, revenues rose by 33.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.34, is low and is below the industry average, implying that there has been successful management of debt levels. Along with this, the company maintains a quick ratio of 5.43, which clearly demonstrates the ability to cover short-term cash needs.
  • 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 year. During the past fiscal year, SCORPIO TANKERS INC continued to lose money by earning -$0.65 versus -$2.59 in the prior year.
  • The gross profit margin for SCORPIO TANKERS INC is rather low; currently it is at 19.60%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -16.21% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$9.30 million or 262.63% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
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Scorpio Tankers Inc. provides seaborne transportation of crude oil and refined petroleum products worldwide. Scorpio Tankers has a market cap of $569.3 million and is part of the services sector and transportation industry. Shares are up 22.2% year to date as of the close of trading on Tuesday.

You can view the full Scorpio Tankers Ratings Report or get investment ideas from our investment research center.

-- Written by a member of TheStreet Ratings Staff

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

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