When you look at NYSE:DQ, it's hard to ignore the strong fundamentals, especially considering its likely undervaluation.

Uncover the hidden value in DAQO NEW ENERGY CORP-ADR (NYSE:DQ) as our stock screening tool recommends it as an undervalued choice. NYSE:DQ maintains a robust financial position and offers an attractive pricing perspective. Let's dig deeper into the analysis.

Evaluating Valuation: NYSE:DQ

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NYSE:DQ was assigned a score of 7 for valuation:

• The Price/Earnings ratio is 9.36, which indicates a very decent valuation of DQ.
• Compared to the rest of the industry, the Price/Earnings ratio of DQ indicates a rather cheap valuation: DQ is cheaper than 97.20% of the companies listed in the same industry.
• DQ is valuated cheaply when we compare the Price/Earnings ratio to 28.49, which is the current average of the S&P500 Index.
• DQ is valuated cheaply with a Price/Forward Earnings ratio of 2.99.
• 100.00% of the companies in the same industry are more expensive than DQ, based on the Price/Forward Earnings ratio.
• When comparing the Price/Forward Earnings ratio of DQ to the average of the S&P500 Index (20.06), we can say DQ is valued rather cheaply.
• Compared to the rest of the industry, the Price/Free Cash Flow ratio of DQ indicates a rather cheap valuation: DQ is cheaper than 100.00% of the companies listed in the same industry.
• DQ has a very decent profitability rating, which may justify a higher PE ratio.

What does the Profitability looks like for NYSE:DQ

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:DQ, the assigned 7 is noteworthy for profitability:

• Measured over the past 3 years, the Average Return On Invested Capital for DQ is significantly above the industry average of 10.73%.
• The last Return On Invested Capital (4.32%) for DQ is well below the 3 year average (25.13%), which needs to be investigated, but indicates that DQ had better years and this may not be a problem.
• In the last couple of years the Profit Margin of DQ has grown nicely.
• With a decent Operating Margin value of 17.40%, DQ is doing good in the industry, outperforming 71.96% of the companies in the same industry.
• DQ's Operating Margin has improved in the last couple of years.
• DQ's Gross Margin has improved in the last couple of years.

Assessing Health Metrics for NYSE:DQ

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:DQ has received a 8 out of 10:

• DQ has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
• A Current Ratio of 4.59 indicates that DQ has no problem at all paying its short term obligations.
• DQ's Current ratio of 4.59 is fine compared to the rest of the industry. DQ outperforms 72.90% of its industry peers.
• DQ has a Quick Ratio of 4.32. This indicates that DQ is financially healthy and has no problem in meeting its short term obligations.
• DQ has a Quick ratio of 4.32. This is in the better half of the industry: DQ outperforms 75.70% of its industry peers.

ChartMill's Evaluation of Growth

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NYSE:DQ has received a 6 out of 10:

• Measured over the past years, DQ shows a very strong growth in Earnings Per Share. The EPS has been growing by 37.63% on average per year.
• DQ shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 50.23% yearly.
• Based on estimates for the next years, DQ will show a very strong growth in Earnings Per Share. The EPS will grow by 22.66% on average per year.
• DQ is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 16.11% yearly.

Every day, new Decent Value stocks can be found on ChartMill in our Decent Value screener.

Check the latest full fundamental report of DQ for a complete fundamental analysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.