TREX COMPANY INC (TREX)
US89531P1057 - Common Stock
Taking everything into account, TREX scores 6 out of 10 in our fundamental rating. TREX was compared to 43 industry peers in the Building Products industry. TREX scores excellent points on both the profitability and health parts. This is a solid base for a good stock. TREX is quite expensive at the moment. It does show a decent growth rate. With these ratings, TREX could be worth investigating further for quality investing!.
1. Profitability
1.1 Basic Checks
In the past year TREX was profitable.
In the past year TREX had a positive cash flow from operations.
In the past 5 years TREX has always been profitable.
In the past 5 years TREX always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of TREX (22.02%) is better than 100.00% of its industry peers.
TREX has a better Return On Equity (28.66%) than 79.07% of its industry peers.
Looking at the Return On Invested Capital, with a value of 24.31%, TREX belongs to the top of the industry, outperforming 90.70% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for TREX is significantly above the industry average of 13.74%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 22.02% | ||
| ROE | 28.66% | ||
| ROIC | 24.31% |
ROA(3y)21.49%
ROA(5y)22.34%
ROE(3y)31.02%
ROE(5y)31.02%
ROIC(3y)25.23%
ROIC(5y)25.85%
1.3 Margins
With an excellent Profit Margin value of 18.76%, TREX belongs to the best of the industry, outperforming 97.67% of the companies in the same industry.
In the last couple of years the Profit Margin of TREX has remained more or less at the same level.
TREX has a Operating Margin of 25.23%. This is amongst the best in the industry. TREX outperforms 95.35% of its industry peers.
TREX's Operating Margin has been stable in the last couple of years.
With an excellent Gross Margin value of 41.32%, TREX belongs to the best of the industry, outperforming 83.72% of the companies in the same industry.
In the last couple of years the Gross Margin of TREX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.23% | ||
| PM (TTM) | 18.76% | ||
| GM | 41.32% |
OM growth 3Y-1.65%
OM growth 5Y-0.46%
PM growth 3Y-2.01%
PM growth 5Y-0.94%
GM growth 3Y0.41%
GM growth 5Y-0.84%
2. Health
2.1 Basic Checks
TREX has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
TREX has about the same amout of shares outstanding than it did 1 year ago.
TREX has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, TREX has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 30.75 indicates that TREX is not in any danger for bankruptcy at the moment.
TREX's Altman-Z score of 30.75 is amongst the best of the industry. TREX outperforms 100.00% of its industry peers.
The Debt to FCF ratio of TREX is 0.02, which is an excellent value as it means it would take TREX, only 0.02 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.02, TREX belongs to the top of the industry, outperforming 90.70% of the companies in the same industry.
A Debt/Equity ratio of 0.01 indicates that TREX is not too dependend on debt financing.
The Debt to Equity ratio of TREX (0.01) is better than 86.05% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | 0.02 | ||
| Altman-Z | 30.75 |
ROIC/WACC2.04
WACC11.9%
2.3 Liquidity
TREX has a Current Ratio of 1.89. This is a normal value and indicates that TREX is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.89, TREX is doing worse than 60.47% of the companies in the same industry.
A Quick Ratio of 0.72 indicates that TREX may have some problems paying its short term obligations.
TREX has a Quick ratio of 0.72. This is amonst the worse of the industry: TREX underperforms 88.37% of its industry peers.
The current and quick ratio evaluation for TREX is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.89 | ||
| Quick Ratio | 0.72 |
3. Growth
3.1 Past
TREX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 14.11%, which is quite good.
The Earnings Per Share has been growing by 10.24% on average over the past years. This is quite good.
The Revenue has decreased by -1.01% in the past year.
Measured over the past years, TREX shows a quite strong growth in Revenue. The Revenue has been growing by 9.86% on average per year.
EPS 1Y (TTM)14.11%
EPS 3Y6.27%
EPS 5Y10.24%
EPS growth Q2Q122.22%
Revenue 1Y (TTM)-1.01%
Revenue growth 3Y7.52%
Revenue growth 5Y9.86%
Revenue growth Q2Q1.9%
3.2 Future
The Earnings Per Share is expected to grow by 16.04% on average over the next years. This is quite good.
Based on estimates for the next years, TREX will show a quite strong growth in Revenue. The Revenue will grow by 10.50% on average per year.
EPS Next Y21.59%
EPS Next 2Y18.14%
EPS Next 3Y16.04%
EPS Next 5YN/A
Revenue Next Year13.38%
Revenue Next 2Y11.98%
Revenue Next 3Y10.5%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 48.48, which means the current valuation is very expensive for TREX.
Based on the Price/Earnings ratio, TREX is valued expensively inside the industry as 81.40% of the companies are valued cheaper.
TREX is valuated expensively when we compare the Price/Earnings ratio to 25.20, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 39.87 indicates a quite expensive valuation of TREX.
Based on the Price/Forward Earnings ratio, TREX is valued a bit more expensive than 76.74% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.60. TREX is valued rather expensively when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 48.48 | ||
| Fwd PE | 39.87 |
4.2 Price Multiples
TREX's Enterprise Value to EBITDA ratio is a bit more expensive when compared to the industry. TREX is more expensive than 79.07% of the companies in the same industry.
TREX's Price/Free Cash Flow ratio is rather expensive when compared to the industry. TREX is more expensive than 81.40% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 43.88 | ||
| EV/EBITDA | 29.24 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates TREX does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of TREX may justify a higher PE ratio.
TREX's earnings are expected to grow with 16.04% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.24
PEG (5Y)4.74
EPS Next 2Y18.14%
EPS Next 3Y16.04%
5. Dividend
5.1 Amount
TREX does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
TREX COMPANY INC
NYSE:TREX (4/23/2024, 6:31:01 PM)
After market: 90.17 0 (0%)90.17
+2.35 (+2.68%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap9.80B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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Min EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
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Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 48.48 | ||
| Fwd PE | 39.87 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.24
PEG (5Y)4.74
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 22.02% | ||
| ROE | 28.66% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 25.23% | ||
| PM (TTM) | 18.76% | ||
| GM | 41.32% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.17
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.01 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.89 | ||
| Quick Ratio | 0.72 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)14.11%
EPS 3Y6.27%
EPS 5Y
EPS growth Q2Q
EPS Next Y21.59%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-1.01%
Revenue growth 3Y7.52%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y