DAQO New Energy (NYSE:DQ) & Trinseo (NYSE:TSE) Head-To-Head Review

DAQO New Energy (NYSE:DQ) and Trinseo (NYSE:TSE) are both basic materials companies, but which is the better stock? We will contrast the two companies based on the strength of their earnings, profitability, institutional ownership, analyst recommendations, valuation, dividends and risk.

Institutional & Insider Ownership

47.2% of DAQO New Energy shares are owned by institutional investors. Comparatively, 82.7% of Trinseo shares are owned by institutional investors. 24.3% of DAQO New Energy shares are owned by insiders. Comparatively, 4.5% of Trinseo shares are owned by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.

Valuation and Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DAQO New Energy	$639.06 million	3.32	-$345.21 million	($5.14)	-6.16
Trinseo	$3.51 billion	0.01	-$348.50 million	($11.55)	-0.09

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

Risk and Volatility

DAQO New Energy has a beta of 0.73, suggesting that its stock price is 27% less volatile than the S&P 500. Comparatively, Trinseo has a beta of 1.52, suggesting that its stock price is 52% more volatile than the S&P 500.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
DAQO New Energy	-53.74%	-5.89%	-5.42%
Trinseo	-13.15%	N/A	-11.72%

Analyst Ratings

This is a breakdown of recent ratings and price targets for DAQO New Energy and Trinseo, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DAQO New Energy	1	2	3	1	2.57
Trinseo	1	1	0	0	1.50

DAQO New Energy currently has a consensus price target of $27.04, suggesting a potential downside of 14.66%. Given DAQO New Energy’s stronger consensus rating and higher possible upside, equities analysts plainly believe DAQO New Energy is more favorable than Trinseo.

Summary

DAQO New Energy beats Trinseo on 9 of the 15 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 Trinseo

Trinseo PLC operates as a specialty material solutions provider in the United States, Europe, the Asia-Pacific, and internationally. It operates through five segments: Engineered Materials, Latex Binders, Plastics Solutions, Polystyrene, and Americas Styrenics. The Engineered Materials segment offers rigid thermoplastic compounds and blends, soft thermoplastic, continuous cast, cell cast, activated methyl methacrylates (MMA), PMMA resins, and extruded PMMA sheets and resins for consumer electronics, medical, footwear, automotive, and building and construction applications under the EMERGE, CALIBRE, PLEXIGLAS, ALTUGLAS, ACRYSPA, AVONITE, STUDIO, MEGOL, APILON, APIGO, and APINAT brands. The Latex Binders segment provides styrene-butadiene latex, and other latex polymers and binders primarily for coated paper and packaging board, carpet, and artificial turf backings, as well as the adhesive, building and construction, and technical textile paper market. The Plastics Solutions segment offers acrylonitrile-butadiene-styrene, styrene-acrylonitrile, polycarbonate, and compounds and blends for automotive and other applications under the MAGNUM brand. The Polystyrene segment provides general purpose polystyrenes and high impact polystyrene for use in appliances, food packaging and food service disposables, consumer electronics, and building and construction materials under the STYRON brand. The Americas Styrenics segment provides styrene and polystyrene for appliances, food packaging, food service disposables, consumer electronics, and building and construction materials applications. Trinseo PLC was incorporated in 2015 and is headquartered in Wayne, Pennsylvania.