What happened

For the second day in a row, shares of oil hauler Scorpio Tankers (NYSE: STNG) are rocking today, adding to yesterday's 8.5% jump with another 11.8% leap (as of 3 p.m. EDT).

For this, you can thank the folks at Deutsche Bank, who reiterated their buy rating on Scorpio stock yesterday and called it a "major opportunity" for investors.

Foredeck of an oil tanker

Deutsche sees a "long runway" at Scorpio Tankers. Problem is, this isn't an aircraft carrier. Image source: Getty Images.

So what

As explained in its write-up, Deutsche admits that there's significant risk in Scorpio shares, inasmuch as the company is expected to have to announce a "highly dilutive equity offering" in the near future, in order to raise cash needed to meet its debt payment obligations. (According to data from S&P Global Market Intelligence, Scorpio is carrying $2.8 billion in debt, but has less than $200 million on hand to service it).

Adding to the company's troubles, the Baltic Clean Tanker Index (BCTI), which tracks the prices companies like Scorpio can charge for transporting refined hydrocarbons, recently grounded upon a new 52-week low of "498." That number that means little in and of itself, but represents about a 33% decline in pricing power from the BCTI's levels of last September. It also helps to explain why Scorpio, which generated positive free cash flow in 2016, burnt through $216 million in negative free cash flow over the past 12 reported months.

Now what

And yet, Deutsche Bank still recommends Scorpio stock as a buy. Why? As the analyst explains in a note covered on TheFly.com, while it's true that an equity offering by Scorpio would be highly dilutive, Deutsche believes it would give Scorpio enough cash to "extend its run-way," permitting the company to grow its fleet and grab market share -- and presumably to profit even more once shipping rates turn back up.

Of course, there's no telling when that will happen or whether Scorpio will survive to see that happy day. Meanwhile, investors in Scorpio today are looking at a stock with about four times more debt on its balance sheet than market capitalization in its stock. I hardly think that makes for a seaworthy investment.