DAQO New Energy (NYSE:DQ) and Hawkins (NASDAQ:HWKN) Head-To-Head Review

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

Profitability

This table compares DAQO New Energy and Hawkins’ 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%
Hawkins	7.75%	16.85%	8.93%

Institutional & Insider Ownership

47.2% of DAQO New Energy shares are held by institutional investors. Comparatively, 69.7% of Hawkins shares are held by institutional investors. 24.3% of DAQO New Energy shares are held by insiders. Comparatively, 4.1% of Hawkins shares are held 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.

Risk & Volatility

DAQO New Energy has a beta of 0.8, indicating that its stock price is 20% less volatile than the S&P 500. Comparatively, Hawkins has a beta of 0.8, indicating that its stock price is 20% less volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for DAQO New Energy and Hawkins, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
DAQO New Energy	2	2	1	1	2.17
Hawkins	0	3	1	0	2.25

DAQO New Energy presently has a consensus target price of $25.43, suggesting a potential upside of 20.05%. Hawkins has a consensus target price of $200.00, suggesting a potential upside of 35.01%. Given Hawkins’ stronger consensus rating and higher possible upside, analysts clearly believe Hawkins is more favorable than DAQO New Energy.

Earnings and Valuation

This table compares DAQO New Energy and Hawkins”s gross 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	2.13	-$170.51 million	($2.54)	-8.34
Hawkins	$974.43 million	3.18	$84.35 million	$3.95	37.50

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

Summary

Hawkins beats DAQO New Energy on 11 of the 13 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 Hawkins

Hawkins, Inc. operates as a specialty chemical and ingredients company in the United States. It operates through three segments: Industrial, Water Treatment, and Health and Nutrition. The Industrial segment offers industrial chemicals, products, and services to agriculture, chemical processing, electronics, energy, food, pharmaceutical, and plating industries. This segment manufactures sodium hypochlorite and agricultural products, as well as various food-grade and pharmaceutical products, such as liquid phosphates, lactates, other blended products, and agricultural products; and receives, stores, and distributes various chemicals comprising liquid caustic soda, sulfuric acid, hydrochloric acid, urea, phosphoric acid, aqua ammonia, and potassium hydroxide. It also repackages water treatment chemicals and bulk industrial chemicals; and performs custom blending of chemicals. The Water Treatment segment provides chemicals, products, equipment, services, and solutions for potable water, municipal and industrial wastewater, industrial process water, non-residential swimming pool water, and agriculture water. The Health and Nutrition segment offers ingredient distribution, processing, and formulation solutions to manufacturers of nutraceutical, functional food and beverage, personal care, dietary supplement and other nutritional food, and health and wellness products. Its products portfolio includes minerals, vitamins and amino acids, excipients, joint products, botanicals and herbs, sweeteners, and enzymes. Hawkins, Inc. was founded in 1938 and is headquartered in Roseville, Minnesota.