Daqo New Energy Corp.: Leads amongst peers with strong fundamentals

Daqo New Energy Corp. relative valuation is NEUTRAL and it has a fundamental analysis score of 72.

Our analysis is based on comparing Daqo New Energy Corp. with the following peers – Dow Chemical Company, Cabot Microelectronics Corporation, Hanwha Q CELLS Co., Ltd. Sponsored ADR, Yingli Green Energy Holding Co. Ltd. Sponsored ADR, JinkoSolar Holding Co., Ltd. Sponsored ADR, ReneSola Ltd. Sponsored ADR and STR Holdings, Inc. (DOW-US, CCMP-US, HQCL-US, YGE-US, JKS-US, SOL-US and STRI-US).

Daqo New Energy Corp. has shown underwhelming performance over the last one year while growing strongly over the last month. Daqo New Energy Corp.’s price momentum over the last month, at 14.04% has been better than that over the last year, which was -10.38%. Also from a peer group perspective, Daqo New Energy Corp. has performed better, since the peer group performance was -1.51% over the last month.

Company Snapshot

  • Considering peers, relative outperformance over the last year and the last month suggest a leading position.
  • It’s current Price/Book of 0.86 is about median in its peer group.
  • The market expects DQ-US to grow at about the same rate as the peers and to maintain the median returns it currently generates.
  • DQ-US‘s relatively high profit margins are burdened by relative asset inefficiency.
  • The company’s year-on-year change in revenues and earnings are better than the median among its peer group.
  • DQ-US‘s return on assets currently and over the past five years suggest that its relatively high operating returns are sustainable.
  • The company’s relatively high gross and pre-tax margins suggest a differentiated product portfolio and tight control on operating costs relative to peers.
  • While DQ-US‘s revenues in recent years have grown faster than the peer median, the market gives the stock a P/E ratio that is around peer median suggesting that the market has some questions about the company’s long-term strategy.
  • The company is likely overinvesting in a business with only median returns.
  • DQ-US seems to be constrained by the current level of debt.
  • Our analysis rates Daqo New Energy Corp. as NEUTRAL relative to its peers.

Share Price Performance

Considering peers, relative outperformance over the last year and the last month suggest a leading position.

DQ-US‘s share price performance of -10.38% over the last 12 months is above peer median of -15.16%. The 30-day trend in its share price performance of 14.04% is also above the peer median of -1.51% suggesting that this company is a leading performer relative to its peers.

Share Price Performance

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Leading, Fading, Lagging, Rising

Relative Valuation

Relative Valuation
Fundamental Score

Daqo New Energy Corp. is currently neutrally valued, as its previous close of USD 22.18 lies within the CapitalCube estimate range of USD 20.25 to USD 24.38. Over the last 52 week period, Daqo New Energy Corp. has fluctuated between USD 18.01 and USD 27.60.

Valuation & Peer Metrics

A complete list of valuation metrics is available on the company page.

Company Profile

Daqo New Energy Corp. is a holding company, which engages in the manufacture and sale of polysilicon products for solar cell and module manufacturers. It operates through the Polysilicon and Wafer segments. The company was founded on November 22, 2007 and is headquartered in Wanzhou, China.

Disclaimer

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