GLJ double upgrades Daqo to Buy on new China policy

GLJ Research analyst Gordon Johnson upgraded Daqo New Energy (DQ) to Buy from Sell with a $30.51 price target which implies 61% potential upside. The firm says the China Ministry of Industry and Information Technology’s proposed policy around polysilicon includes a significant restructuring of the market, with monthly production quotas for the four major producers who make up 80% of global capacity and the forced closure of smaller players. GLJ believes the new policy provides “light at the end of the tunnel” for Daqo and a “real-time check” on the stock’s bull thesis.