Is Buying Stock In Teekay Tankers Ltd. (TNK) A Good Move Today?

Teekay Tankers Ltd. (NYSE:TNK) saw an upside of 2.20% to close Friday at $14.85 after adding $0.32 on the day. The 5-day average trading volume is 480,960 shares of the company’s common stock. It has gained $15.25 in the past week and touched a new high 4 times within the past 5 days. An average of 348,680 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 329,088.

TNK’s 1-month performance is 23.75% or $2.85 on its low of $11.30 reached on 09/20/21. The company’s shares have touched a 52-week low of $8.90 and high of $16.09, with the stock’s rally to the 52-week high happening on 03/18/21. YTD, TNK has achieved 34.88% or $3.84 and has reached a new high 10 times. However, the current price is down -7.71%% from the 52-week high price.

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Valuation Metrics

Teekay Tankers Ltd. (TNK) has a trailing price-to-earnings (P/E) ratio of 14.38 for the broader industry and 18.49 for the sector, meaning that investors are optimistic about the stock’s future prospects. The company’s PE ratio for the last five years has touched a high of 20.68 and a low of 1.421. TNK stock has a beta of 0.18. Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 0.85 while the price-to-book (PB) in the most recent quarter is 0.54.

Teekay Tankers Ltd.’s quick ratio for the period ended June 29 was 0.60, with the current ratio over the same period at 0.80 meaning that TNK stock is able to fulfill its debt obligations. As well, the company’s long term debt to equity for the quarter ending June 29 was 0.47, while the total debt to equity was 0.64. In terms of profitability, the gross margin trailing 12 months is 19.60%The trailing 12-month EBITDA margin is 37.19% while for the period ending June 29; Teekay Tankers Ltd.’s operating margin was -36.00%. The firm’s gross profit as reported stood at $368.63 million against revenue of $886.43 million.

The effectiveness of a company’s management is also important for investors when it comes to determining the potential profitability of the investment. Teekay Tankers Ltd.’s return on assets over the past 12 months stands at -14.90%. Return on investment over the past year is 7.90%, while its return on equity (ROE) trailing 12 months is -25.40%. In comparison, the average ROE for the broader industry over the past year is 1.01.

Earnings Surprise

For the quarterly period ending June 29 this year, Net income and sales went down compared to those figures reported in the previous quarter. Analysts expected TNK to announce -$1.05 per share in earnings in its latest quarter, but it posted -$1.23, representing a -17.10% surprise. EBITDA for the quarter stood at more than -$92.54 million. TNK stock balance sheet for the quarter ending June 29 shows that total liabilities totaled 724.78 million, with total debt at $597.59 million

Technical Picture

Let’s look briefly at Teekay Tankers Ltd. (TNK) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 01 October was 81.07% to suggest the stock is trending Overbought, with historical volatility in this time period at 35.81%.

The stock’s 5-day moving average is $14.21, reflecting a +16.11% or $2.06 change from its current price. TNK is currently trading +20.44% above its 20-day SMA, +7.07% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 and SMA200 by +20.93% and +23.03% respectively.

Stochastic %K and %D was 90.84% and 89.50% and the average true range (ATR) pointed at 0.69. The RSI (14) points at 74.62%, while the 14-day stochastic is at 89.87% with the period’s ATR at 0.63. The stock’s 9-day MACD Oscillator is pointing at 1.09 and 1.55 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Teekay Tankers Ltd. (NYSE: TNK), DNB Markets downgraded it to a Hold rating. They previously had a Buy rating on the stock. Analysts offering their rating for TNK stock have a consensus rating for the stock as Overweight. Currently, 0 brokerage advisors rate TNK as a “sell,”, while 1 advise that investors “Hold.” 1 analysts have rated the stock as underweight. 0 rates the stock as overweight while 6 have offered a “buy” rating.

What is TNK’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $12.00 and a high of $27.00, with their median price target at $20.00. Looking at these predictions, the average price target given by analysts is for Teekay Tankers Ltd. (TNK) stock is $19.34.


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