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Daqo New Energy (DQ)
NYSE:DQ
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Daqo New Energy
(NYSE:DQ)
Rating:42Neutral
Price Target:―
Positive Factors
Government Support
The proposal of a government-organized oligopoly in the Poly-Si space suggests a guaranteed profit margin for the major players, including Daqo.
Market Restructuring
China’s Ministry of Industry and Information Technology’s new proposed policy for the polysilicon segment, which includes monthly production quotas for major producers, may provide a more stable market environment for Daqo New Energy.
Price Stability
The proposed price floor for polysilicon suggests potential upside, as it indicates government support for maintaining profitable price levels for major producers like Daqo.
Negative Factors
Downstream Market Dynamics
More fragmented downstream module makers will see further margin compression, as global solar demand is fading, which could impact related segments in the solar industry.
ETF Performance
Daqo’s U.S.-listed ADR shares are being dragged down due to the performance of the Invesco Solar TAN ETF.
Market Awareness
Most Western U.S. ADR investors missed important news released only to native Chinese investors, affecting the stock's perception.
Daqo New Energy (DQ) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.58B
Dividend YieldN/A
Average Volume (3M)1.28M
Price to Earnings (P/E)―
Beta (1Y)1.02
Revenue Growth-62.86%
EPS Growth-471.48%
CountryUS
Employees4,749
SectorTechnology
Sector Strength86
IndustrySemiconductors
Share Statistics
EPS (TTM)-1.14
Shares Outstanding67,056,720
10 Day Avg. Volume1,017,464
30 Day Avg. Volume1,279,138
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap0.94
Enterprise Value/Revenue2.01
Enterprise Value/Gross Profit-4.05
Enterprise Value/Ebitda-3.96
Forecast
1Y Price Target
$29.50Price Target Upside29.16% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Daqo New Energy Business Overview & Revenue Model
Company DescriptionDaqo New Energy Corp., together with its subsidiaries, manufactures and sells polysilicon to photovoltaic product manufactures in the People's Republic of China. Its products are used in ingots, wafers, cells, and modules for solar power solutions. The company was formerly known as Mega Stand International Limited and changed its name to Daqo New Energy Corp. in August 2009. Daqo New Energy Corp. was founded in 2006 and is based in Shanghai, the People's Republic of China.
How the Company Makes MoneyDaqo New Energy makes money primarily through the production and sale of high-purity polysilicon to solar manufacturers. The company sells its product to major solar wafer manufacturers, who then use it to produce solar cells and modules. Daqo's revenue streams are significantly influenced by polysilicon prices, production volumes, and long-term supply agreements with key clients. The company benefits from economies of scale and technological advancements that enhance production efficiency and cost-effectiveness. Additionally, strategic partnerships with industry players and a strong focus on maintaining high-quality standards contribute to Daqo's earnings and market position.
Daqo New Energy Earnings Call Summary
Earnings Call Date:Aug 26, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Negative
The earnings call highlighted strong financial liquidity and positive long-term industry prospects, but these were overshadowed by significant revenue declines, negative gross margins, and continued challenges with industry overcapacity. The company is optimistic about future policies and long-term growth; however, current financial performance remains under pressure.Q2-2025 Updates
Positive Updates
Strong Financial Liquidity
Daqo New Energy Corp. maintains a strong and healthy balance sheet with no financial debt and financial assets readily convertible into cash totaling $2.06 billion.
Cost Reduction Achievements
A decline in the cost of silicon metal and reduced energy consumption drove cash costs lower by 4% to $5.12 per kilogram sequentially.
Positive Industry Policy Developments
Chinese authorities have intensified efforts to curb disorderly competition, and initiatives have led to a rebound in polysilicon sales prices in July.
Long-term Industry Prospects
The solar PV industry shows strong long-term prospects, with solar power expected to remain a key global energy driver.
Share Repurchase Program Announcement
The company authorized a $100 million share repurchase program until the end of next year, showing optimism about the future.
Negative Updates
Significant Revenue Decline
Revenues dropped to $75.2 million from $123.9 million in the first quarter of 2025 and $219.9 million in the same quarter of 2024.
Negative Gross Margin and Operating Losses
Gross margin was negative 108% and operating margin was negative 153%, with a net loss attributable to shareholders of $76.5 million.
Decrease in Sales Volume
Sales volume for the quarter decreased significantly to 18,126 metric tons from 28,008 metric tons in the first quarter.
Continued Industry Overcapacity Challenges
The solar PV industry faced challenges with market prices across the value chain declining due to overcapacity and high inventory levels.
Company Guidance
In the second quarter of 2025, Daqo New Energy Corp. faced challenging market conditions in the solar PV industry, characterized by declining prices and overcapacity, leading to operating and net losses. Despite these challenges, the company maintained a robust financial position with no financial debt, a cash balance of CNY599 million, short-term investments of CNY490 million, and bank notes receivable of $49 million. Total financial assets readily convertible into cash stood at $2.06 billion. The company's production volume was 29,012 metric tons, within the guidance range of 25,000 to 28,000 metric tons, but sales volume decreased to 18,126 metric tons due to strategic scaling back of new sales orders amid market uncertainties. Polysilicon unit production costs decreased by 4% to an average of $7.26 per kilogram, supported by lower costs of silicon metal and reduced energy consumption. Looking ahead, Daqo expects total polysilicon production in 2025 to be approximately 27,000 to 30,000 metric tons, with a full-year production range of 110,000 to 130,000 metric tons. The company is optimistic about long-term industry growth, driven by government initiatives to curb unfair competition and enhance industry regulation, and plans to leverage its strong balance sheet and competitive cost structure to capitalize on market recovery and growth.Daqo New Energy Financial Statement Overview
Summary
Daqo New Energy is currently facing a challenging financial landscape. The income statement shows declining revenues and profitability, impacting overall financial stability. The balance sheet remains fairly strong with no debt, but declining equity is a concern. Cash flow performance has deteriorated, raising questions about the company's ability to sustain operations without positive cash flow.Income Statement
Daqo New Energy's income statement reveals a challenging financial period. The company experienced a significant drop in total revenue from $4.6 billion in 2022 to $1.03 billion in 2024, reflecting a sharp revenue decline. The gross profit margin turned negative in 2024, indicating the cost of goods sold exceeded revenue. Additionally, both EBIT and net income margins are negative, demonstrating declining operational and overall profitability. While the past showed strong growth, recent performance highlights instability and potential market challenges.45
Neutral
Balance Sheet
Daqo's balance sheet indicates a mixed financial position. Positive aspects include zero total debt in 2024, suggesting no leverage risk and a healthy cash position with $2.1 billion in cash and equivalents. However, stockholders' equity has decreased from 2023 to 2024, and the equity ratio remains stable but not improving. The company’s ability to maintain a debt-free status is commendable, yet declining equity may pose future challenges.55
Neutral
Cash Flow
Daqo's cash flow statement reveals pressure on cash generation. Operating cash flow turned negative in 2024, indicating potential difficulties in generating cash from core operations. Free cash flow has also significantly decreased, suggesting reduced financial flexibility. While the company previously enjoyed strong free cash flow growth, recent trends indicate a challenging cash flow environment that could impact future operations and investments.40
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 737.68M | 1.03B | 2.31B | 4.61B | 1.68B | 675.60M |
| Gross Profit | -366.55M | -212.93M | 920.65M | 3.41B | 1.10B | 233.99M |
| EBITDA | -375.18M | -179.88M | 932.32M | 3.15B | 1.13B | 188.76M |
| Net Income | -432.52M | -345.21M | 429.55M | 1.82B | 748.92M | 129.19M |
Balance Sheet | ||||||
| Total Assets | 6.31B | 6.42B | 7.43B | 7.59B | 3.34B | 1.24B |
| Cash, Cash Equivalents and Short-Term Investments | 2.09B | 2.14B | 3.04B | 3.53B | 1.00B | 76.60M |
| Total Debt | 0.00 | 6.82M | 0.00 | 20.69M | 0.00 | 243.09M |
| Total Liabilities | 497.34M | 560.38M | 978.58M | 948.24M | 672.53M | 440.23M |
| Stockholders Equity | 4.33B | 4.36B | 4.76B | 4.85B | 2.17B | 767.12M |
Cash Flow | ||||||
| Free Cash Flow | -594.68M | -794.50M | 429.20M | 1.22B | 130.16M | 91.41M |
| Operating Cash Flow | -360.67M | -437.72M | 1.62B | 2.47B | 639.10M | 209.70M |
| Investing Cash Flow | -1.50B | -1.48B | -1.20B | -1.00B | -782.00M | -118.49M |
| Financing Cash Flow | -41.35M | -47.36M | -795.40M | 1.47B | 736.23M | -95.47M |
Daqo New Energy Technical Analysis
Positive
22.84
Price Trends
20.34
Positive
17.14
Positive
18.26
Positive
Market Momentum
0.74
Positive
55.71
Neutral
37.85
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DQ, the sentiment is Positive. The current price of 22.84 is above the 20-day moving average (MA) of 22.22, above the 50-day MA of 20.34, and above the 200-day MA of 18.26, indicating a bullish trend. The MACD of 0.74 indicates Positive momentum. The RSI at 55.71 is Neutral, neither overbought nor oversold. The STOCH value of 37.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DQ.
Daqo New Energy Risk Analysis
Daqo New Energy disclosed 70 risk factors in its most recent earnings report. Daqo New Energy reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Daqo New Energy Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $17.19B | 13.61 | 10.98% | 7.22% | 5.46% | -26.72% | |
69 Neutral | $20.85B | 47.82 | 5.72% | ― | -17.93% | -75.83% | |
68 Neutral | $24.40B | 39.54 | 3.72% | 1.13% | -22.97% | -78.58% | |
67 Neutral | $21.22B | 20.46 | 10.97% | 3.57% | 4.86% | 6.44% | |
61 Neutral | $36.05B | 6.66 | -10.10% | 1.86% | 8.68% | -8.81% | |
53 Neutral | $36.49B | 84.25 | -2.24% | 2.79% | -35.70% | -113.08% | |
42 Neutral | $1.58B | ― | -8.73% | ― | -62.86% | -471.48% |
* Technology Sector Average
Performance Comparison
DQ
Daqo New Energy
22.84
8.28
56.87%
ASX
ASE Technology Holding Co
9.97
0.38
3.96%
MCHP
Microchip
65.25
-13.42
-17.06%
ON
ON Semiconductor
50.78
-25.52
-33.45%
STM
STMicroelectronics
27.59
-3.20
-10.39%
UMC
United Micro
6.69
-1.58
-19.11%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.