DAQO New Energy (NYSE:DQ) & Solar Integrated Roofing (OTCMKTS:SIRC) Critical Analysis

Solar Integrated Roofing (OTCMKTS:SIRC) and DAQO New Energy (NYSE:DQ) are both small-cap technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, profitability, dividends and earnings.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Solar Integrated Roofing and DAQO New Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Solar Integrated Roofing	0	0	0	0	0.00
DAQO New Energy	2	3	2	1	2.25

DAQO New Energy has a consensus target price of $22.35, suggesting a potential upside of 83.42%. Given DAQO New Energy’s stronger consensus rating and higher probable upside, analysts plainly believe DAQO New Energy is more favorable than Solar Integrated Roofing.

Profitability

This table compares Solar Integrated Roofing and DAQO New Energy’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Solar Integrated Roofing	N/A	N/A	N/A
DAQO New Energy	-32.92%	-3.19%	-2.94%

Institutional and Insider Ownership

47.2% of DAQO New Energy shares are held by institutional investors. 4.3% of Solar Integrated Roofing shares are held by insiders. Comparatively, 24.3% of DAQO New Energy shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Valuation & Earnings

This table compares Solar Integrated Roofing and DAQO New Energy”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Solar Integrated Roofing	$37.31 million	0.00	-$27.40 million	($0.03)	N/A
DAQO New Energy	$568.22 million	1.45	-$170.51 million	($2.78)	-4.38

Solar Integrated Roofing has higher earnings, but lower revenue than DAQO New Energy. DAQO New Energy is trading at a lower price-to-earnings ratio than Solar Integrated Roofing, indicating that it is currently the more affordable of the two stocks.

Risk & Volatility

Solar Integrated Roofing has a beta of -1.36, suggesting that its share price is 236% less volatile than the S&P 500. Comparatively, DAQO New Energy has a beta of 0.65, suggesting that its share price is 35% less volatile than the S&P 500.

Summary

DAQO New Energy beats Solar Integrated Roofing on 8 of the 13 factors compared between the two stocks.

About Solar Integrated Roofing

Solar Integrated Roofing Corp. provides integrated, single-source solar power and roofing systems installation services for commercial and residential properties in the United States. It offers battery backup, electric vehicle charging, roofing, and related HVAC/electrical contracting works; and sells solar panels. The company was formerly known as Landstar Development Group, Inc. and changed its name to Solar Integrated Roofing Corp. in November 2015. Solar Integrated Roofing Corp. was incorporated in 2007 and is based in Henderson, Nevada.

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.