• In early February 2026, GLJ Research downgraded Daqo New Energy from Buy to Sell, citing concerns over China’s polysilicon supply-demand balance and uneven policy execution intended to curb excess capacity.
• The firm also projected that Daqo’s net losses could narrow in 2025 compared with 2024, highlighting operational improvement that contrasts with persistent industry headwinds.
• We’ll now examine how GLJ Research’s downgrade, driven by China’s polysilicon market uncertainties, shapes Daqo New Energy’s broader investment narrative.

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What Is Daqo New Energy's Investment Narrative?

To own Daqo New Energy today, you have to believe that its polysilicon franchise can work through a harsh downcycle in China and eventually make use of its capacity and cost base again. The GLJ Research downgrade, coming alongside a sharp share price pullback over the past month, reinforces that near term sentiment is fragile and that China’s uneven efforts to rein in excess polysilicon supply remain the key swing factor. It also puts more focus on execution: Daqo is still loss making after revenue falling from US$2,307.70 million in 2023 to US$1,029.08 million in 2024, yet it is guiding steady production and has a US$100.00 million buyback in place. The downgrade does not remove existing catalysts, but it raises the bar for evidence that losses can narrow in a market GLJ now views more cautiously.

However, there is one operational risk in particular that shareholders should not overlook. Despite retreating, Daqo New Energy's shares might still be trading above their fair value and there could be some more downside. Discover how much.

Exploring Other Perspectives

Four Simply Wall St Community fair value estimates span roughly US$33.04 to a very large US$120.49, underscoring how differently people view Daqo. Set against GLJ’s downgrade and China’s polysilicon uncertainty, this spread invites you to weigh several competing views on how quickly losses might narrow and what that could mean for future performance.

Explore 4 other fair value estimates on Daqo New Energy - why the stock might be worth just $33.04!

Build Your Own Daqo New Energy Narrative

Disagree with this assessment? Create your own narrative in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Daqo New Energy research is our analysis highlighting 2 key rewards that could impact your investment decision.
• Our free Daqo New Energy research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Daqo New Energy's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.