Scorpio Tankers Q3 profit beats on strong demand, refining margins

Overview

• Product tanker operator's Q3 adjusted EPS beat analyst expectations

• Q3 adjusted net income slightly missed analyst expectations

• Q3 net income more than doubled yr/yr, driven by stronger product tanker markets

Outlook

• Scorpio Tankers expects Q4 2026 LR2 pool/spot TCE revenue at $181,000 per day

• Company expects Q4 2026 MR pool/spot TCE revenue at $56,000 per day

• Company says it has a constructive outlook on the VLCC market

Result Drivers

• STRONGER PRODUCT TANKER MARKET - Co said higher TCE revenue was driven by robust demand, strong refining margins, rising seaborne volumes, and disruption from Middle East conflict

• FEWER VESSELS - Co said vessel operating costs fell due to a lower average number of vessels following sales of MRs and LR2s

• LOWER FINANCIAL EXPENSES - Co said financial expenses declined due to reduced debt levels and lower average cost of debt

Company press release:

Key Details

*Applies to a deviation of less than 1%; not applicable for per-share numbers.

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 10 "strong buy" or "buy", 1 "hold" and 1 "sell" or "strong sell"

• The average consensus recommendation for the oil & gas transportation services peer group is "buy"

• Wall Street's median 12-month price target for Scorpio Tankers Inc. is $106.50, about 24.8% above its October 27 closing price of $85.33

• The stock recently traded at 11 times the next 12-month earnings vs. a P/E of 7 three months ago

Reuters Recommended Reads

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)