SkyWater Technology (NASDAQ:SKYT – Get Free Report) and Daqo New Energy (NYSE:DQ – Get Free Report) are both small-cap computer and technology companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, profitability, dividends, analyst recommendations, valuation, institutional ownership and risk.
Analyst Ratings
This is a summary of recent ratings and price targets for SkyWater Technology and Daqo New Energy, as reported by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| SkyWater Technology | 0 | 0 | 4 | 0 | 3.00 |
| Daqo New Energy | 0 | 1 | 4 | 3 | 3.25 |
SkyWater Technology currently has a consensus target price of $12.75, suggesting a potential upside of 16.23%. Daqo New Energy has a consensus target price of $22.26, suggesting a potential upside of 23.10%. Given Daqo New Energy’s stronger consensus rating and higher possible upside, analysts clearly believe Daqo New Energy is more favorable than SkyWater Technology.
Profitability
| Net Margins | Return on Equity | Return on Assets | |
| SkyWater Technology | -4.75% | -12.40% | -2.47% |
| Daqo New Energy | -9.16% | -1.90% | -1.68% |
Institutional & Insider Ownership
70.0% of SkyWater Technology shares are owned by institutional investors. Comparatively, 47.2% of Daqo New Energy shares are owned by institutional investors. 42.6% of SkyWater Technology shares are owned by company insiders. Comparatively, 24.3% of Daqo New Energy shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.
Valuation and Earnings
This table compares SkyWater Technology and Daqo New Energy”s top-line revenue, earnings per share (EPS) and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| SkyWater Technology | $286.68 million | 1.82 | -$30.76 million | ($0.35) | -31.34 |
| Daqo New Energy | $2.31 billion | 0.52 | $429.55 million | ($1.85) | -9.78 |
Daqo New Energy has higher revenue and earnings than SkyWater Technology. SkyWater Technology is trading at a lower price-to-earnings ratio than Daqo New Energy, indicating that it is currently the more affordable of the two stocks.
Volatility & Risk
SkyWater Technology has a beta of 3.43, meaning that its share price is 243% more volatile than the S&P 500. Comparatively, Daqo New Energy has a beta of 0.26, meaning that its share price is 74% less volatile than the S&P 500.
Summary
Daqo New Energy beats SkyWater Technology on 8 of the 14 factors compared between the two stocks.
About SkyWater Technology
SkyWater Technology, Inc., together with its subsidiaries, operates as a pure-play technology foundry that engages in the provision of semiconductor development, manufacturing, and packaging services in the United States. The company offers engineering and process development support services to co-create technologies with customers; and semiconductor manufacturing services for various silicon-based analog and mixed-signal, micro-electromechanical systems, and rad-hard integrated circuits. It serves customers operating in the computation, aerospace and defense, automotive, bio-health, consumer, and industrial sectors. The company was incorporated in 2016 and is headquartered in Bloomington, Minnesota.
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.
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