Daqo (DQ) Soars 13.0%: Is Further Upside Left in the Stock?
Daqo New Energy (DQ) shares rallied 13% in the last trading session to close at $13.75. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 0.7% loss over the past four weeks.
DAQO New Energy has established itself as a highly cost-efficient polysilicon producer, enabling it to remain competitive even during periods of pricing pressure across the industry. Its focus on manufacturing ultra-high-purity polysilicon positions the company to capitalize on the increasing adoption of N-type solar cells, as these next-generation technologies require higher-quality materials to achieve greater energy conversion efficiency.
This solar panel parts maker is expected to post quarterly loss of $0.28 per share in its upcoming report, which represents a year-over-year change of +75.4%. Revenues are expected to be $59.2 million, down 21.3% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Daqo, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on DQ going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Daqo is a member of the Zacks Solar industry. One other stock in the same industry, Canadian Solar (CSIQ), finished the last trading session 2.9% higher at $15.52. CSIQ has returned 4.3% over the past month.
Canadian Solar's consensus EPS estimate for the upcoming report has remained unchanged over the past month at -$1.01. Compared to the company's year-ago EPS, this represents a change of -90.6%. Canadian Solar currently boasts a Zacks Rank of #3 (Hold).
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This article originally published on Zacks Investment Research (zacks.com).
