Tower Semiconductor (NASDAQ:TSEM) & DAQO New Energy (NYSE:DQ) Head to Head Comparison
by Sarita Garza · The Markets DailyDAQO New Energy (NYSE:DQ – Get Free Report) and Tower Semiconductor (NASDAQ:TSEM – Get Free Report) are both technology companies, but which is the superior business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, earnings, institutional ownership, valuation, dividends and risk.
Insider and Institutional Ownership
47.2% of DAQO New Energy shares are held by institutional investors. Comparatively, 70.5% of Tower Semiconductor shares are held by institutional investors. 24.3% of DAQO New Energy shares are held by insiders. Comparatively, 1.0% of Tower Semiconductor shares are held by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.
Valuation and Earnings
This table compares DAQO New Energy and Tower Semiconductor”s gross revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| DAQO New Energy | $665.41 million | 1.11 | -$170.51 million | ($3.40) | -3.21 |
| Tower Semiconductor | $1.57 billion | 11.71 | $220.47 million | $3.11 | 52.43 |
Tower Semiconductor has higher revenue and earnings than DAQO New Energy. DAQO New Energy is trading at a lower price-to-earnings ratio than Tower Semiconductor, indicating that it is currently the more affordable of the two stocks.
Profitability
This table compares DAQO New Energy and Tower Semiconductor’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| DAQO New Energy | -45.46% | -3.90% | -3.58% |
| Tower Semiconductor | 19.36% | 11.94% | 9.90% |
Analyst Recommendations
This is a summary of current recommendations for DAQO New Energy and Tower Semiconductor, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| DAQO New Energy | 3 | 1 | 1 | 0 | 1.60 |
| Tower Semiconductor | 0 | 2 | 7 | 1 | 2.90 |
DAQO New Energy presently has a consensus price target of $13.73, indicating a potential upside of 25.78%. Tower Semiconductor has a consensus price target of $297.12, indicating a potential upside of 82.22%. Given Tower Semiconductor’s stronger consensus rating and higher possible upside, analysts clearly believe Tower Semiconductor is more favorable than DAQO New Energy.
Risk & Volatility
DAQO New Energy has a beta of 0.5, meaning that its share price is 50% less volatile than the S&P 500. Comparatively, Tower Semiconductor has a beta of 0.95, meaning that its share price is 5% less volatile than the S&P 500.
Summary
Tower Semiconductor beats DAQO New Energy on 14 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 Tower Semiconductor
Tower Semiconductor Ltd., an independent semiconductor foundry, focus on specialty process technologies to manufacture analog intensive mixed-signal semiconductor devices in Israel, the United States, Japan, Europe, and internationally. It provides various customizable process technologies, including SiGe, BiCMOS, mixed signal/CMOS, RF CMOS, CMOS image sensor, integrated power management, and MEMS. The Company also provides design enablement platform for quick and accurate design cycle, as well as transfer optimization and development process services to integrated device manufacturers and fabless companies. It serves various markets, such as consumer electronics, personal computers, communications, automotive, industrial, aerospace, military, and medical device products. The company was incorporated in 1993 and is headquartered in Migdal Haemek, Israel.