DAQO New Energy (NYSE:DQ) Shares Gap Down - What's Next?

Key Points

• DAQO New Energy's stock gapped down to $26.34 from a previous close of $27.25, indicating a 4.3% decline.
• Analysts have mixed ratings for the company, with recent upgrades and downgrades, including a downgrade by Goldman Sachs and an upgrade to "strong-buy" by HSBC.
• The company has initiated a $100 million share buyback program, suggesting management believes its shares are undervalued.

DAQO New Energy Corp. (NYSE:DQ - Get Free Report) gapped down prior to trading on Thursday . The stock had previously closed at $27.25, but opened at $26.34. DAQO New Energy shares last traded at $26.28, with a volume of 234,801 shares trading hands.

Wall Street Analysts Forecast Growth

A number of equities analysts have recently commented on DQ shares. HSBC raised shares of DAQO New Energy from a "hold" rating to a "buy" rating and set a $31.00 price objective for the company in a report on Wednesday, August 27th. Roth Capital reiterated a "neutral" rating and set a $25.00 target price on shares of DAQO New Energy in a research report on Thursday. New Street Research set a $15.40 price target on shares of DAQO New Energy in a research report on Thursday. Hsbc Global Res raised DAQO New Energy from a "hold" rating to a "strong-buy" rating in a research note on Wednesday, August 27th. Finally, Citigroup raised their price target on DAQO New Energy from $27.00 to $37.00 and gave the company a "buy" rating in a report on Monday, September 8th. Two analysts have rated the stock with a Strong Buy rating, four have assigned a Buy rating, one has assigned a Hold rating and one has issued a Sell rating to the company. According to MarketBeat, the stock currently has an average rating of "Moderate Buy" and a consensus target price of $25.84.

DAQO New Energy Price Performance

The company has a market cap of $1.79 billion, a price-to-earnings ratio of -4.57 and a beta of 0.50. The stock has a 50-day moving average price of $23.64 and a 200 day moving average price of $18.32.

DAQO New Energy (NYSE:DQ - Get Free Report) last posted its quarterly earnings results on Tuesday, August 26th. The semiconductor company reported ($1.14) earnings per share (EPS) for the quarter, topping the consensus estimate of ($1.16) by $0.02. The firm had revenue of $75.19 million for the quarter, compared to analyst estimates of $140.54 million. DAQO New Energy had a negative net margin of 65.64% and a negative return on equity of 6.54%. Sell-side analysts expect that DAQO New Energy Corp. will post -3.5 EPS for the current fiscal year.

DAQO New Energy declared that its board has approved a stock buyback plan on Tuesday, August 26th that authorizes the company to repurchase $0.00 in outstanding shares. This repurchase authorization authorizes the semiconductor company to purchase shares of its stock through open market purchases. Stock repurchase plans are typically an indication that the company's board of directors believes its shares are undervalued.

Hedge Funds Weigh In On DAQO New Energy

A number of large investors have recently made changes to their positions in DQ. Squarepoint Ops LLC lifted its holdings in shares of DAQO New Energy by 34.0% in the second quarter. Squarepoint Ops LLC now owns 51,516 shares of the semiconductor company's stock worth $781,000 after acquiring an additional 13,072 shares during the last quarter. Marex Group plc purchased a new position in shares of DAQO New Energy during the second quarter valued at approximately $356,000. Headlands Technologies LLC purchased a new position in DAQO New Energy during the second quarter worth about $29,000. Scoggin Management LP bought a new position in shares of DAQO New Energy during the 2nd quarter worth approximately $1,517,000. Finally, BNP Paribas Financial Markets grew its holdings in shares of DAQO New Energy by 137.6% in the second quarter. BNP Paribas Financial Markets now owns 401,919 shares of the semiconductor company's stock valued at $6,097,000 after acquiring an additional 232,759 shares in the last quarter. Institutional investors own 47.22% of the company's stock.

About DAQO New Energy

Daqo New Energy Corp., together with its subsidiaries, manufactures and sells polysilicon to photovoltaic product manufacturers 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.