Euronav (EURN) vs. Scorpio Tankers (STNG) Financial Review

Euronav (NYSE: EURN) and Scorpio Tankers (NYSE:STNG) are both small-cap transportation companies, but which is the superior business? We will compare the two companies based on the strength of their analyst recommendations, risk, profitability, dividends, valuation, institutional ownership and earnings.

Profitability

This table compares Euronav and Scorpio Tankers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Euronav -16.10% -5.18% -3.30%
Scorpio Tankers -32.67% -7.61% -2.87%

Insider and Institutional Ownership

22.3% of Euronav shares are owned by institutional investors. Comparatively, 62.9% of Scorpio Tankers shares are owned by institutional investors. 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.

Risk and Volatility

Euronav has a beta of 0.54, suggesting that its stock price is 46% less volatile than the S&P 500. Comparatively, Scorpio Tankers has a beta of 1.34, suggesting that its stock price is 34% more volatile than the S&P 500.

Dividends

Euronav pays an annual dividend of $0.12 per share and has a dividend yield of 1.4%. Scorpio Tankers pays an annual dividend of $0.04 per share and has a dividend yield of 1.4%. Euronav pays out -133.3% of its earnings in the form of a dividend. Scorpio Tankers pays out -8.5% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Analyst Recommendations

This is a summary of current ratings and price targets for Euronav and Scorpio Tankers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Euronav 0 3 3 0 2.50
Scorpio Tankers 0 0 9 0 3.00

Euronav currently has a consensus target price of $9.45, suggesting a potential upside of 12.50%. Scorpio Tankers has a consensus target price of $4.68, suggesting a potential upside of 67.69%. Given Scorpio Tankers’ stronger consensus rating and higher probable upside, analysts clearly believe Scorpio Tankers is more favorable than Euronav.

Earnings & Valuation

This table compares Euronav and Scorpio Tankers’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Euronav $513.37 million 2.61 $1.38 million ($0.09) -93.33
Scorpio Tankers $512.73 million 1.80 -$158.24 million ($0.47) -5.94

Euronav has higher revenue and earnings than Scorpio Tankers. Euronav is trading at a lower price-to-earnings ratio than Scorpio Tankers, indicating that it is currently the more affordable of the two stocks.

Summary

Scorpio Tankers beats Euronav on 8 of the 15 factors compared between the two stocks.

About Euronav

Euronav NV, together with its subsidiaries, owns, operates, and manages a fleet of vessels for the ocean transportation and storage of crude oil and petroleum products worldwide. The company operates through two segments, Tankers; and Floating Production, Storage, and Offloading Operations. As of August 23, 2017, it owned and operated a fleet of 56 double hulled vessels, including 30 very large crude carriers, 1 V-Plus vessel, 19 Suezmax vessels, and 2 floating, storage, and offloading vessels, as well as 4 Suezmax vessels under construction. The company was incorporated in 2003 and is headquartered in Antwerp, Belgium.

About Scorpio Tankers

Scorpio Tankers Inc., together with its subsidiaries, engages in the seaborne transportation of refined petroleum products worldwide. As of March 22, 2018, its fleet consisted of 109 tankers, including 38 LR2, 12 LR1, 45 MR, and 14 Handymax tankers with an average age of approximately 2.6 years; and 20 time or bareboat chartered-in tankers, which include 2 LR2, 10 MR, and 8 Handymax tankers. The company was founded in 2009 and is based in Monaco.

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