Daqo New Energy (DQ) shares rallied 14.3% in the last trading session to close at $85.60. This move can be attributable to notable volume with a higher number of shares being traded than in a typical session. This compares to the stock's 7.3% loss over the past four weeks.
DQ’s rally is largely driven by President Biden’s new emission reduction proposals. Biden has pledged to reduce U.S. greenhouse gas emissions by at least 50% by 2030 in his latest push to fight against climate change. The president’s ambitious plan triggered a rally in solar stocks including Daqo New Energy.
Price and Consensus
This solar panel parts maker is expected to post quarterly earnings of $0.89 per share in its upcoming report, which represents a year-over-year change of +93.5%. Revenues are expected to be $242.8 million, up 43.8% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Daqo, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on DQ going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank 1 (Strong Buy). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
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