Yahoo Finance Scorpio Tankers Inc. Just Recorded A 15% EPS Beat: Here's What Analysts Are Forecasting Next
As you might know, Scorpio Tankers Inc. (NYSE:STNG) just kicked off its latest first-quarter results with some very strong numbers. It was overall a positive result, with revenues beating expectations by 2.3% to hit US$390m. Scorpio Tankers reported statutory earnings per share (EPS) US$4.11, which was a notable 15% above what the analysts had forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results.
See our latest analysis for Scorpio Tankers
After the latest results, the eleven analysts covering Scorpio Tankers are now predicting revenues of US$1.38b in 2024. If met, this would reflect an okay 2.4% improvement in revenue compared to the last 12 months. Per-share earnings are expected to shoot up 25% to US$13.87. Before this earnings report, the analysts had been forecasting revenues of US$1.38b and earnings per share (EPS) of US$12.16 in 2024. Although the revenue estimates have not really changed, we can see there's been a solid gain to earnings per share expectations, suggesting that the analysts have become more bullish after the latest result.
The consensus price target rose 6.6% to US$90.82, suggesting that higher earnings estimates flow through to the stock's valuation as well. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Scorpio Tankers, with the most bullish analyst valuing it at US$104 and the most bearish at US$77.00 per share. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Scorpio Tankers' past performance and to peers in the same industry. We would highlight that Scorpio Tankers' revenue growth is expected to slow, with the forecast 3.2% annualised growth rate until the end of 2024 being well below the historical 19% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 2.2% annually. Even after the forecast slowdown in growth, it seems obvious that Scorpio Tankers is also expected to grow faster than the wider industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Scorpio Tankers following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Scorpio Tankers analysts - going out to 2026, and you can see them free on our platform here.
We don't want to rain on the parade too much, but we did also find 2 warning signs for Scorpio Tankers (1 can't be ignored!) that you need to be mindful of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
