Scorpio Tankers has delivered a 323% return since July 2021, far outpacing the S&P 500, and its stock is up 28.9% over the past six months following solid quarterly results. The company boasts a five-year average gross margin of 68.8% and an average free cash flow margin of 50.5%, both among the best in the industrials sector. However, its total vessels fell to 91 in the latest quarter, with an average annual decline of 7.9% over the past two years, signaling potential demand weakness or rising competition. The stock currently trades at $76.44, or 6.8 times forward earnings.
Scorpio Tankers IncSolid quarterly results and elite margins (68.8% gross, 50.5% FCF) support the stock, but a shrinking fleet (91 vessels, -7.9%/yr) signals potential demand weakness or rising competition.