Novozymes A/S (OTCMKTS:NVZMY) and DAQO New Energy (NYSE:DQ) Head to Head Survey

DAQO New Energy (NYSE:DQ) and Novozymes A/S (OTCMKTS:NVZMY) are both basic materials companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, earnings, risk, profitability, analyst recommendations, dividends and valuation.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for DAQO New Energy and Novozymes A/S, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DAQO New Energy	2	2	1	1	2.17
Novozymes A/S	0	1	0	0	2.00

DAQO New Energy currently has a consensus price target of $25.43, suggesting a potential upside of 11.49%. Given DAQO New Energy’s stronger consensus rating and higher possible upside, research analysts plainly believe DAQO New Energy is more favorable than Novozymes A/S.

Profitability

This table compares DAQO New Energy and Novozymes A/S’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
DAQO New Energy	-25.62%	-2.92%	-2.69%
Novozymes A/S	13.96%	6.38%	4.36%

Institutional and Insider Ownership

47.2% of DAQO New Energy shares are held by institutional investors. Comparatively, 0.0% of Novozymes A/S shares are held by institutional investors. 24.3% of DAQO New Energy shares are held by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares DAQO New Energy and Novozymes A/S”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
DAQO New Energy	$665.41 million	2.30	-$170.51 million	($2.54)	-8.98
Novozymes A/S	$4.70 billion	4.89	$660.13 million	$1.40	39.61

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

Volatility & Risk

DAQO New Energy has a beta of 0.68, meaning that its stock price is 32% less volatile than the S&P 500. Comparatively, Novozymes A/S has a beta of 1.11, meaning that its stock price is 11% more volatile than the S&P 500.

Summary

Novozymes A/S beats DAQO New Energy 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 Novozymes A/S

Novozymes A/S produces and sells industrial enzymes, microorganisms, and probiotics in Denmark, rest of Europe, North America, Asia Pacific, the Middle East, Africa, Latin America, and internationally. The company offers protein solutions for the food and beverage industry. It also offers industrial hygiene, drain openers, hard surface, medical cleaning, septic tanks, ware washing, and professional laundry services. In addition, the company provides dishwashing, softener, microbial and medical cleaning services. Further, it provides corn, cotton, forages, peanuts, pulses, soybeans, wheat, small grains, bioyield, and biocontrol solutions; warm water species, recirculating aquaculture system; animal health and nutrition solutions; fiber modification, bleach boosting, deposit control, and starch modification solutions. Additionally, the company provides carbon capture, leather and textiles solutions; enzyme solutions, including corn and wheat separation, liquefaction, saccharification, filtration, isomerization, maltose, and specialties solutions; warm water species and recirculating aquaculture system solutions; human health solutions, comprising brain, oral, protective and immune, and gastrointestinal health solutions; ethanol, biodiesel, renewable diesel, education, wastewater, and sewage sludge, and renewable diesel solutions; agriculture and industry, biogas food waste, food waste, biocatalysis, cell culture, diagnostics, enzyme, and biogas solutions. Furthermore, it provides lipases, proteases, oxidoreductases, and carbohydrases. Novozymes A/S was founded in 1925 and is based in Bagsvaerd, Denmark.