Head to Head Review: Sumco (OTCMKTS:SUOPY) vs. Daqo New Energy (NYSE:DQ)

Sumco (OTCMKTS:SUOPY) and Daqo New Energy (NYSE:DQ) are both computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitability, analyst recommendations and institutional ownership.

Analyst Recommendations

This is a breakdown of current ratings and price targets for Sumco and Daqo New Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Sumco	0	0	0	0	0.00
Daqo New Energy	0	1	4	3	3.25

Daqo New Energy has a consensus price target of $22.26, indicating a potential upside of 24.37%. Given Daqo New Energy’s stronger consensus rating and higher possible upside, analysts plainly believe Daqo New Energy is more favorable than Sumco.

Volatility & Risk

Sumco has a beta of 1.01, meaning that its stock price is 1% more volatile than the S&P 500. Comparatively, Daqo New Energy has a beta of 0.26, meaning that its stock price is 74% less volatile than the S&P 500.

Earnings and Valuation

This table compares Sumco and Daqo New Energy”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Sumco	$3.04 billion	0.85	$453.58 million	$0.80	18.50
Daqo New Energy	$2.31 billion	0.51	$429.55 million	($1.85)	-9.68

Sumco has higher revenue and earnings than Daqo New Energy. Daqo New Energy is trading at a lower price-to-earnings ratio than Sumco, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

0.0% of Sumco shares are owned by institutional investors. Comparatively, 47.2% of Daqo New Energy shares are owned by institutional investors. 24.3% of Daqo New Energy shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Profitability

This table compares Sumco and Daqo New Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Sumco	5.25%	3.25%	1.83%
Daqo New Energy	-9.16%	-1.90%	-1.68%

Summary

Sumco beats Daqo New Energy on 9 of the 15 factors compared between the two stocks.

About Sumco

Sumco Corporation manufactures and sells silicon wafers for the semiconductor industry in Japan, the United States, China, Taiwan, Korea, and internationally. It provides monocrystalline ingots, as well as polished, annealed, epitaxial, junction isolated, silicon-on-insulator, and reclaimed polished wafers. The company was formerly known as Sumitomo Mitsubishi Silicon Corp. and changed its name to Sumco Corporation in August 2005. Sumco Corporation was incorporated in 1999 and is headquartered in Tokyo, Japan.

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.