We are experiencing some temporary issues. The market data on this page is currently delayed. Please bear with us as we address this and restore your personalized lists.
Unlock stock picks and a broker-level newsfeed that powers Wall Street.
We recently published a list of 10 Best Solar Stocks to Buy in 2025. In this article, we are going to take a look at where Daqo New Energy Corp. (NYSE:DQ) stands against other best solar stocks to buy in 2025.
Solar energy has become a key driver in the global shift toward sustainable power. It plays a crucial role in reducing greenhouse gas emissions, enhancing energy security, and fostering economic growth. By harnessing solar power, nations can reduce their reliance on fossil fuels, lowering their exposure to volatile energy markets. Moreover, with its low carbon footprint, solar energy is also a key solution for fighting climate change.
According to the International Energy Agency (IEA), declining costs have led to a surge in solar photovoltaic (PV) adoption. Over the past five years, global solar capacity has tripled. Between 2024 and 2030, solar PV is projected to drive 80% of the world’s renewable energy expansion, driven by large-scale solar farms and increased rooftop installations. By the end of the decade, solar is expected to surpass wind and hydropower as the dominant renewable energy source.
Solar Market Trends and Challenges
Wood Mackenzie’s 2025 solar market report, Solar: predictions for 2025, highlights that global installed capacity reached 495 GW in 2024, marking a 14% increase from the previous year. The rising demand for electricity, fuelled by data centers and electrification trends, continues to support this expansion. However, political shifts following the 2024 elections could introduce policy uncertainties, affecting renewable energy incentives. In mature markets, the reduction of financial support, such as feed-in tariffs and capital expenditure rebates, may slow growth after years of rapid acceleration.
Despite concerns over market saturation, a shift is taking place in 2025. Overcapacity in solar module manufacturing has led top producers to limit supply, with major polysilicon manufacturers reducing production and module makers setting price floors. This suggests the market could shift back in favor of suppliers.
Looking beyond short-term fluctuations, Deloitte’s 2025 Renewable Energy Industry Outlook expresses confidence in solar’s long-term trajectory. Their research found that solar was the only major energy source to record significant capacity growth, surging 88% to 18.6 GW. By the end of 2024, solar overtook hydropower and nuclear to become the fourth-largest source of installed capacity, trailing only wind, natural gas, and coal. The US Energy Information Administration (EIA) also projects record-breaking additions in 2024, with solar capacity expected to grow by 38.4 GW, far exceeding the 6.5 GW increase expected for wind power.
In summary, solar energy has become a key part of the global shift toward cleaner power. Its fast growth is fuelled by new technology, lower costs, and supportive policies. However, future progress will depend on addressing policy uncertainties and infrastructure challenges. With ongoing innovation and strong government support, solar energy is set to remain a major player in the clean energy transition. Keeping this in mind, let’s explore our top picks for the best solar stocks to buy in 2025.
Our Methodology
To identify the stocks, we began by compiling a list of solar companies with a market capitalization of at least $500 million. This was done using online stock screeners, solar-focused ETFs, and financial media reports. Next, we filtered the list to include only those stocks with an upside potential of at least 10%. From this refined selection, we identified the top 10 stocks with the highest hedge fund ownership, leveraging data from Insider Monkey’s Q4 2024 hedge fund database. Finally, we ranked these stocks in ascending order based on the number of hedge funds holding positions in them.
Note: All pricing data is as of market close on March 20.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Is Daqo New Energy Corp. (DQ)the Best Solar Stock to Buy in 2025?
A production line of solar cells, the lifeline of the corporation.
Another China-based company, Daqo New Energy Corp. (NYSE:DQ), is a leading producer of high-purity polysilicon, a critical material used in the production of solar PV cells. The company supplies to major solar module manufacturers worldwide, playing a vital role in the solar value chain.
The company generates over 60% of its revenue by selling polysilicon products to major China-based photovoltaic manufacturers like JinkoSolar, Shuangliang, and Gokin Solar. In its Q4 2024 results announced on February 27, financial performance showed signs of stabilization, with quarterly revenue down just 2% from the prior quarter, reaching $195.4 million, and a gross loss of $65.3 million, compared to $60.6 million in Q3 2024. However, for FY 2024, revenue dropped significantly to $1.0 billion from $2.3 billion in 2023, accompanied by a gross loss of $213 million, a sharp contrast to the $921 million gross profit seen the previous year.
While Daqo New Energy Corp. (NYSE:DQ) stands to benefit long-term from global decarbonization goals and growing solar adoption, 2024 proved to be a difficult year due to excess capacity in the solar PV industry. This oversupply triggered significant price reductions across the value chain. In response, the company reduced production to mitigate losses, though it was insufficient to offset weaker demand and declining prices.
Despite these issues, on February 27, JP Morgan analyst Alan Hon maintained a Buy rating for Daqo with a price target of $28.5. Market sentiment remains generally positive, with a consensus 1-year median price target of $26, reflecting a potential 30% upside from current levels.
Overall, DQ ranks 8th on our list of best solar stocks to buy in 2025. While we acknowledge the potential of DQ to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DQ but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
