Scorpio Tankers (STNG) and International Seaways (INSW) Critical Survey
Scorpio Tankers (NYSE: STNG) and International Seaways (NYSE:INSW) are both small-cap transportation companies, but which is the superior stock? We will compare the two businesses based on the strength of their institutional ownership, valuation, earnings, analyst recommendations, profitability, risk and dividends.
Valuation & Earnings
This table compares Scorpio Tankers and International Seaways’ top-line revenue, earnings per share (EPS) and valuation.
|Gross Revenue||Price/Sales Ratio||NetIncome||Earnings Per Share||Price/Earnings Ratio|
|Scorpio Tankers||$522.75 million||1.78||-$24.90 million||($0.79)||-4.19|
|International Seaways||$398.32 million||1.26||-$18.22 million||($2.51)||-6.87|
International Seaways has higher revenue, but lower earnings than Scorpio Tankers. International Seaways is trading at a lower price-to-earnings ratio than Scorpio Tankers, indicating that it is currently the more affordable of the two stocks.
Institutional and Insider Ownership
56.3% of Scorpio Tankers shares are held by institutional investors. Comparatively, 90.8% of International Seaways shares are held by institutional investors. 0.5% of International Seaways shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.
This table compares Scorpio Tankers and International Seaways’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
Scorpio Tankers pays an annual dividend of $0.04 per share and has a dividend yield of 1.2%. International Seaways does not pay a dividend. Scorpio Tankers pays out -5.1% of its earnings in the form of a dividend. International Seaways has increased its dividend for 3 consecutive years.
This is a summary of current recommendations and price targets for Scorpio Tankers and International Seaways, as reported by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
Scorpio Tankers presently has a consensus price target of $6.56, suggesting a potential upside of 98.26%. International Seaways has a consensus price target of $30.00, suggesting a potential upside of 73.91%. Given Scorpio Tankers’ higher possible upside, analysts clearly believe Scorpio Tankers is more favorable than International Seaways.
Scorpio Tankers Company Profile
Scorpio Tankers Inc. (Scorpio Tankers) is engaged in the seaborne transportation of refined petroleum products in the international shipping markets. The Company operates through four segments: Handymax, MR, LR1/Panamax and LR2. As of March 15, 2017, the Company’s fleet consisted of 78 owned tankers (22 LR2, 14 Handymax and 42 MR) with a weighted average age of approximately 2.3 years, and 19 time or bareboat chartered-in tankers, which it operated (one LR2, one LR1, eight MR and nine Handymax) (collectively referred to as its Operating Fleet). As of March 1, 2017, the Company’s total oil tanker fleet (crude, products and product/chemical tankers) consisted of 4,754 ships with a combined capacity of 525.9 million deadweight tonnage. As of December 31, 2016, the Company also had contracts for the construction of one LR2 tanker and eight MR tankers. Its vessels include STI Brixton, STI Comandante, STI Finchley, STI Hammersmith, STI Larvotto, STI San Antonio and STI Regina.
International Seaways Company Profile
International Seaways, Inc. and its subsidiaries own and operate a fleet of oceangoing vessels. The Company’s oceangoing vessels engage in the transportation of crude oil and petroleum products in the International Flag trades. The Company’s segments are International Crude Tankers and International Product Carriers. Its 55-vessel fleet consists of Ultra Large Crude Carrier (ULCC), Very Large Crude Carrier (VLCC), Aframax and Panamax crude tankers, as well as long range 1 (LR1), LR2 and medium range (MR) product carriers. Its International Crude Tankers segment is made up of a ULCC and a fleet of VLCCs, Aframaxes, and Panamaxes. Its International Product Carriers segment consists of a fleet of MRs, LR1s and an LR2 engaged in the transportation of crude and refined petroleum products. Through joint venture partnerships (the JVs), it has ownership interests in approximately four liquefied natural gas carriers and approximately two floating storage and offloading service vessels.
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