Head-To-Head Review: DAQO New Energy (NYSE:DQ) & SIKA (OTCMKTS:SXYAY)

SIKA (OTCMKTS:SXYAY) and DAQO New Energy (NYSE:DQ) are both basic materials companies, but which is the superior investment? We will contrast the two businesses based on the strength of their earnings, institutional ownership, risk, analyst recommendations, profitability, valuation and dividends.

Analyst Recommendations

This is a summary of recent recommendations and price targets for SIKA and DAQO New Energy, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
SIKA	1	4	1	3	2.67
DAQO New Energy	1	2	3	1	2.57

DAQO New Energy has a consensus price target of $27.04, suggesting a potential downside of 18.11%. Given DAQO New Energy’s higher possible upside, analysts plainly believe DAQO New Energy is more favorable than SIKA.

Insider and Institutional Ownership

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 large money managers, hedge funds and endowments believe a company is poised for long-term growth.

Earnings and Valuation

This table compares SIKA and DAQO New Energy”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
SIKA	$13.36 billion	2.47	$1.41 billion	N/A	N/A
DAQO New Energy	$1.03 billion	2.15	-$345.21 million	($5.14)	-6.42

SIKA has higher revenue and earnings than DAQO New Energy.

Profitability

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

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

Summary

SIKA beats DAQO New Energy on 8 of the 12 factors compared between the two stocks.

About SIKA

Sika AG, a specialty chemicals company, develops, produces, and sells systems and products for bonding, sealing, damping, reinforcing, and protecting in the building sector and motor vehicle industry worldwide. The company offers tile adhesives and grouts, systems for under-tile waterproofing, sound reduction, renders, decorative finishes for exterior and interior walls, as well as exterior insulation finishing system; develops admixtures and additives for concrete, cement, and mortar production; and flat roofing systems. It also provides a range of technologies used for below and above-ground waterproofing, including flexible membrane systems, liquid-applied membranes, joint waterproofing systems, and waterproofing mortars and injection resins for commercial and residential basements, tunnels, bridges, and various types of water-retaining structures, such as reservoirs, storage basins, and storage tanks. In addition, the company offers flooring solutions, such as synthetic resin and cementitious systems for industrial and commercial buildings; and sealants, adhesives, tapes, and spray foams for the building facades, interior finishing, and infrastructure projects. Further, it provides repairing, reinforcing, and protective solutions for concrete structures, such as repair mortars, shrinking grouts, anchoring adhesives, protective coatings, corrosion control, and structural strengthening systems. The company serves automobile and commercial vehicle assembly, automotive aftermarket, marine vessel, industrial lamination, renewable energy, home appliance, and facade engineering industries. The company was founded in 1910 and is headquartered in Baar, Switzerland.

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.