Shares of Daqo New Energy (DQ) plunged 5.03% in pre-market trading on Thursday, following a significant downgrade from Goldman Sachs. The investment bank lowered its rating on the Chinese solar-grade polysilicon manufacturer from Neutral to Sell, sparking a selloff among investors.

Goldman Sachs not only downgraded Daqo New Energy but also set a new price target of Rmb 15.40. The firm's analysts believe that the current valuation of Daqo New Energy has already priced in potential upsides, suggesting limited room for further growth. This pessimistic outlook from a major Wall Street firm has clearly shaken investor confidence in the stock.

The downgrade comes at a challenging time for the solar energy sector, which has been facing headwinds due to supply chain issues and changing government policies. For Daqo New Energy, this rating change could potentially impact its ability to raise capital and may lead to increased scrutiny of its business model and growth prospects in the competitive renewable energy market.