Daqo New Energy (NYSE:DQ – Get Free Report) and SkyWater Technology (NASDAQ:SKYT – Get Free Report) are both small-cap basic materials companies, but which is the superior stock? We will compare the two businesses based on the strength of their dividends, valuation, profitability, earnings, institutional ownership, analyst recommendations and risk.
Profitability
This table compares Daqo New Energy and SkyWater Technology’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Daqo New Energy | -9.16% | -1.90% | -1.68% |
| SkyWater Technology | -4.75% | -12.40% | -2.47% |
Earnings & Valuation
This table compares Daqo New Energy and SkyWater Technology”s top-line revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Daqo New Energy | $2.31 billion | 0.52 | $429.55 million | ($1.85) | -9.81 |
| SkyWater Technology | $286.68 million | 1.96 | -$30.76 million | ($0.35) | -33.60 |
Insider and Institutional Ownership
47.2% of Daqo New Energy shares are held by institutional investors. Comparatively, 70.0% of SkyWater Technology shares are held by institutional investors. 24.3% of Daqo New Energy shares are held by company insiders. Comparatively, 42.6% of SkyWater Technology shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
Volatility and Risk
Daqo New Energy has a beta of 0.26, suggesting that its share price is 74% less volatile than the S&P 500. Comparatively, SkyWater Technology has a beta of 3.43, suggesting that its share price is 243% more volatile than the S&P 500.
Analyst Recommendations
This is a breakdown of current ratings and price targets for Daqo New Energy and SkyWater Technology, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Daqo New Energy | 0 | 1 | 4 | 3 | 3.25 |
| SkyWater Technology | 0 | 0 | 4 | 0 | 3.00 |
Daqo New Energy currently has a consensus target price of $22.26, indicating a potential upside of 22.62%. SkyWater Technology has a consensus target price of $12.75, indicating a potential upside of 8.42%. Given Daqo New Energy’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Daqo New Energy is more favorable than SkyWater Technology.
Summary
Daqo New Energy beats SkyWater Technology on 8 of the 14 factors compared between the two stocks.
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. in August 2009. Daqo New Energy Corp. was founded in 2006 and is based in Shanghai, the People's Republic of China.
About SkyWater Technology
SkyWater Technology, Inc., together with its subsidiaries, operates as a pure-play technology foundry that engages in the provision of semiconductor development, manufacturing, and packaging services in the United States. The company offers engineering and process development support services to co-create technologies with customers; and semiconductor manufacturing services for various silicon-based analog and mixed-signal, micro-electromechanical systems, and rad-hard integrated circuits. It serves customers operating in the computation, aerospace and defense, automotive, bio-health, consumer, and industrial sectors. The company was incorporated in 2016 and is headquartered in Bloomington, Minnesota.
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