Yes it was torpedo capable. See above.
"Cant Z 1007 aprox. 4,410 pounds internaly, alternatively two 1,000 pound torpedos and 4 bombs up to 551lb on under wing racks."
On 29th Augast 1940 the Z 1007 began it's operational carier, the first unit to go into action the 106th Gruppo (260th and 261st Squadrigli) operating from Trapani-Milo aganst Malta.
In October the 50th Groupo began operating from Brindisi over the Greek Albanian war theater. Later it was joined by the newly formed 51st Groupo.
The CAI also operated some Cant Z 1007's over England during the Battle of Briton.
Later in the Balken Campagine More and more Z 1007 units were formed as production proceded and new machines went into service, the 47 Stormo, 41st Groupo then the 95th all particapated in the Balkin camagine.
At this time several S.79 units (late 41) begain to convert to the New Cant Z 1007 as more became available.
Operations over Malta contunied all through this time...
Cant Z 1007 also were operating in NA at this time with various units including the 176th Squadriglia, then in Augast 42 the largest presence in Libya came with the 35Stormo (86th and 95th Groupo), operating agnast Tobrook, and during the Remender of the campagine in NA all the way up till the withdrawl of forces in NA.
A few Cant's also went to Russia.
Cant Z 1007's operated from Libbya, sardinia, Sicily,Greece, and Rhodes, their targets included raids aganst the Middle east, Alexandria, and British shiping throught the med, and target's throught NA.
They operated right up till the end , and after serving with the Allies and Axis forces after the surender, and the last was decomishioned in 1949.
