The Q2 spot rate guidance ($96K/day LR2, $66K/day MR) implies a massive sequential acceleration from Q1 averages ($50.8K LR2, $33.6K MR), suggesting Q2 earnings could double Q1's already strong results. The $500M buyback authorization and $375M convertible issuance create a capital return vs. dilution dynamic — watch for accelerated share repurchases. The stock's strong historical momentum (avg +10% T+20 on prior calls) and 82% analyst bullishness support continued upside, but the convertible overhang (9.96 shares per $1,000 note, ~$100.39 conversion) caps near-term upside.
Price Chart
Executive Summary
Scorpio Tankers reported Q1 2026 GAAP net income of $216.3M ($4.32 diluted EPS), a sharp increase from $58.2M ($1.22 diluted) a year ago, driven by a significantly stronger product tanker market with average daily TCE revenue rising 57% to $37,697. The company also announced a $0.45 quarterly dividend, a $500M share repurchase authorization replenishment, and issued $375M in convertible notes. However, the Street consensus was for EPS of $2.62, making the headline GAAP EPS a beat but the adjusted EPS of $3.02 also above consensus, while revenue of $312.9M exceeded the $274.5M estimate.
Key Financial Metrics
Key Facts
- Q1 2026 GAAP net income of $216.3M ($4.32 diluted EPS) vs $58.2M ($1.22 diluted) in Q1 2025
- Adjusted net income of $150.9M ($3.02 diluted EPS) vs $49.0M ($1.03 diluted) in Q1 2025
- TCE revenue increased 48% to $303.0M from $204.2M; average daily TCE rose 57% to $37,697
- Board declared $0.45 quarterly dividend (payable June 15, 2026) and replenished share repurchase program to $500M
- Issued $375M convertible notes due 2031 at 1.75% coupon; concurrently repurchased 1.34M shares at $74.36
- Agreed to sell 11 vessels for ~$500M aggregate; closed 4 vessel sales for $223.4M in Q1
- Cash and undrawn revolver capacity of $2.1B as of May 1, 2026; net cash position of $479M
- Q2 2026 spot/pool TCE guidance: LR2 $96,000/day, MR $66,000/day, Handymax $61,000/day — well above Q1 levels
Financial Impact
Net income surged 272% YoY to $216.3M; TCE revenue up 48% to $303M; Q2 spot rates already running 2x Q1 averages
Risk Factors
- Product tanker rates are cyclical and could soften if Middle East tensions de-escalate or global demand weakens
- Convertible notes add $375M debt and potential dilution if stock trades above $100.39 conversion price
- Fleet reduction through vessel sales (11 sold/agreed) reduces future earning capacity
- Significant newbuilding capex commitments ($641.5M remaining) could pressure cash flow
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 1 press release from GlobeNewswire.
| Document | Accession Number |
|---|---|
| PRESS-RELEASE Data (Synthetic) | press-3287466 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Sep 4, 2026 28d ago | 144 | $82.12 $85.73 | ▼ −4.40% | ▼ −5.51% | $86.23 (−5.00%) |
Jun 18, 2026 15w ago | Press Release | $80.58 $75.46 | ▼ −6.35% | ▼ −4.69% | $86.23 (+7.01%) |
May 28, 2026 18w ago | 6-K | $74.51 $75.96 | ▲ +1.95% | ▲ +4.47% | $86.23 (+15.73%) |
May 27, 2026 18w ago | Press Release | $77.70 $75.04 | ▼ −3.42% | ▼ −4.63% | $86.23 (+10.98%) |
May 8, 2026 21w ago | Press Release | $84.41 $82.72 | ▼ −2.00% | ▼ −3.47% | $86.23 (+2.16%) |
May 5, 2026 21w ago | 6-K | $82.56 $83.51 | ▲ +1.15% | ▲ +0.02% | $86.23 (+4.45%) |
May 5, 2026 21w ago | Press Release | $86.62 $85.15 | ▼ −1.70% | ▼ −3.68% | $86.23 (−0.45%) |
Apr 21, 2026 23w ago | 6-K | $75.97 $82.08 | ▲ +8.04% | ▲ +7.98% | $86.23 (+13.51%) |
Apr 21, 2026 23w ago | 6-K | $75.97 $82.08 | ▲ +8.04% | ▲ +7.98% | $86.23 (+13.51%) |
Apr 10, 2026 25w ago | Press Release | $76.45 $76.89 | ▲ +0.58% | ▼ −2.72% | $86.23 (+12.79%) |
US Market Status
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