Head to Head Analysis: Scorpio Tankers (NYSE:STNG) and Flex LNG (NYSE:FLNG)

Scorpio Tankers (NYSE:STNG) and Flex LNG (NYSE:FLNG) are both transportation companies, but which is the better business? We will contrast the two companies based on the strength of their risk, institutional ownership, earnings, dividends, valuation, analyst recommendations and profitability.

Dividends

Scorpio Tankers pays an annual dividend of $1.68 per share and has a dividend yield of 3.3%. Flex LNG pays an annual dividend of $3.00 per share and has a dividend yield of 12.2%. Scorpio Tankers pays out 28.4% of its earnings in the form of a dividend. Flex LNG pays out 163.9% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Scorpio Tankers has increased its dividend for 2 consecutive years.

Institutional & Insider Ownership

54.6% of Scorpio Tankers shares are held by institutional investors. 7.3% of Scorpio Tankers shares are held by insiders. Comparatively, 0.3% of Flex LNG shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Profitability

This table compares Scorpio Tankers and Flex LNG’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Scorpio Tankers	32.01%	7.42%	5.56%
Flex LNG	28.06%	14.04%	4.09%

Earnings and Valuation

This table compares Scorpio Tankers and Flex LNG”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Scorpio Tankers	$1.24 billion	2.11	$668.77 million	$5.91	8.70
Flex LNG	$356.35 million	3.71	$117.68 million	$1.83	13.39

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Scorpio Tankers and Flex LNG, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Scorpio Tankers	0	3	4	1	2.75
Flex LNG	0	3	0	0	2.00

Scorpio Tankers presently has a consensus target price of $69.20, suggesting a potential upside of 34.54%. Flex LNG has a consensus target price of $23.00, suggesting a potential downside of 6.16%. Given Scorpio Tankers’ stronger consensus rating and higher probable upside, research analysts plainly believe Scorpio Tankers is more favorable than Flex LNG.

Volatility and Risk

Scorpio Tankers has a beta of -0.3, suggesting that its stock price is 130% less volatile than the S&P 500. Comparatively, Flex LNG has a beta of 0.35, suggesting that its stock price is 65% less volatile than the S&P 500.

Summary

Scorpio Tankers beats Flex LNG on 13 of the 18 factors compared between the two stocks.

About Scorpio Tankers

Scorpio Tankers Inc., together with its subsidiaries, engages in the seaborne transportation of crude oi and refined petroleum products in the shipping markets worldwide. As of March 21, 2024, its fleet consisted of 110 owned and leases financed tanker, including 39 LR2, 57 MR, and 14 Handymax with a weighted average age of approximately 8.1 years. Scorpio Tankers Inc. was incorporated in 2009 and is headquartered in Monaco.

About Flex LNG

FLEX LNG Ltd. engages in the seaborne transportation of liquefied natural gas (LPG) through the ownership and operation of LNG carriers. The company was founded by Philip Eystein Fjeld, Trym Tveitnes and Jostein Ueland in September 2006 and is headquartered in Hamilton, Bermuda.