Is Scorpio Tankers, Inc. overvalued or undervalued?

As of 12 February 2025, the valuation grade for Scorpio Tankers, Inc. has moved from attractive to very attractive, indicating a significant positive shift in its perceived value. The company is currently undervalued, supported by a P/E ratio of 7, a PEG ratio of 0.28, and an impressive dividend yield of 141.78%. These metrics suggest that the stock is trading at a discount compared to its earnings growth potential and offers substantial returns to shareholders.
In comparison to peers, Scorpio Tankers has a lower P/E ratio than Kirby Corp., which stands at 19.91, and a more favorable EV/EBITDA ratio than Frontline Plc, which is at 8.61. The company's return on equity (ROE) of 23.34% and return on capital employed (ROCE) of 18.06% further highlight its operational efficiency and profitability relative to its peers. Despite a challenging year with a YTD return of -14.85% compared to the S&P 500's 2.44%, Scorpio Tankers' robust fundamentals and attractive valuation position it well for future growth.