Daqo New Energy Posts $1.31 Loss, Revenue Plunges 78%, Price Target Cut to $19
Daqo New Energy reported a Q1 loss of $1.31 per share on $26.7 million revenue, down 78% year-over-year and missing the $0.13 loss estimate. Roth Capital cut its price target to $19 from $25 as the company faces a significant polysilicon inventory buildup and weak downstream demand.
1. Q1 Financial Results
Daqo New Energy posted a first-quarter loss of $1.31 per share versus a consensus loss estimate of $0.13 per share. Revenue fell to $26.7 million from $123.91 million year-over-year, marking a 78% decline driven by subdued sales volumes.
2. Production, Sales and Inventory
The company maintained production at approximately 43,402 metric tons of polysilicon but sold only around 4,482 metric tons, leading to a significant buildup of unsold inventory. This inventory accumulation underscores weak downstream purchasing across the solar value chain.
3. Price Target Revision
Roth Capital Partners reduced its price target for Daqo New Energy to $19 from $25, reflecting a more cautious outlook on near-term profitability. The revision factors in ongoing pricing pressure on polysilicon and slower order flow from solar panel manufacturers.
4. Market Challenges
Daqo New Energy operates in an oversupplied solar photovoltaic sector facing declining polysilicon prices and uneven global demand. Elevated inventory levels industry-wide and cautious customer purchasing behavior continue to weigh on margins and cash flow.