Daqo New Energy (NYSE: DQ) saw its stock surge 5.04% in intraday trading on Tuesday, extending its impressive run that has seen shares climb nearly 30% over the past three months. The solar energy component manufacturer's latest rally comes amid growing investor interest fueled by analyst assessments and positive industry developments.

Analysts have pointed to potential undervaluation of Daqo New Energy's stock, with consensus estimates suggesting it may be undervalued by as much as 3.9%. Some valuation models even indicate a more significant upside potential. Adding to the bullish sentiment, recent regulatory interventions by Chinese authorities are expected to stabilize polysilicon prices and improve industry profitability. These changes could potentially boost Daqo's future revenue and margins, contributing to the stock's attractiveness.

While the solar sector has faced volatility, Daqo's recent performance suggests growing optimism about its growth prospects. However, investors should remain cautious, as persistent industry oversupply and the company's history of operating losses could pose risks to the current upbeat outlook. Market participants will be closely watching Daqo's upcoming Q3 2025 financial results, scheduled for release on October 27, for further confirmation of the company's improved positioning in the evolving solar energy landscape.