Taking everything into account, TREX scores 4 out of 10 in our fundamental rating. TREX was compared to 42 industry peers in the Building Products industry. TREX scores excellent on profitability, but there are some minor concerns on its financial health. TREX is valued expensive and it does not seem to be growing.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year TREX was profitable.
TREX had a positive operating cash flow in the past year.
In the past 5 years TREX has always been profitable.
Each year in the past 5 years TREX had a positive operating cash flow.

1.2 Ratios

The Return On Assets of TREX (13.62%) is better than 83.33% of its industry peers.
TREX's Return On Equity of 18.98% is fine compared to the rest of the industry. TREX outperforms 69.05% of its industry peers.
TREX's Return On Invested Capital of 16.07% is amongst the best of the industry. TREX outperforms 80.95% of its industry peers.
TREX had an Average Return On Invested Capital over the past 3 years of 21.94%. This is significantly above the industry average of 12.68%.
The last Return On Invested Capital (16.07%) for TREX is well below the 3 year average (21.94%), which needs to be investigated, but indicates that TREX had better years and this may not be a problem.

		Industry Rank	Sector Rank
ROA	13.62%
ROE	18.98%
ROIC	16.07%

ROA(3y)19.63%

ROA(5y)20.87%

ROE(3y)30.3%

ROE(5y)29.91%

ROIC(3y)21.94%

ROIC(5y)24.11%

1.3 Margins

TREX has a Profit Margin of 16.76%. This is amongst the best in the industry. TREX outperforms 90.48% of its industry peers.
TREX's Profit Margin has been stable in the last couple of years.
The Operating Margin of TREX (23.50%) is better than 97.62% of its industry peers.
TREX's Operating Margin has been stable in the last couple of years.
TREX's Gross Margin of 39.69% is fine compared to the rest of the industry. TREX outperforms 76.19% of its industry peers.
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	23.5%
PM (TTM)	16.76%
GM	39.69%

OM growth 3Y-0.33%

OM growth 5Y1.01%

PM growth 3Y4.08%

PM growth 5Y0.25%

GM growth 3Y3.11%

GM growth 5Y0.51%

More info and screens

ROA

ROE

ROIC

Operating and Profit Margin

Show most profitable peers

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 less shares outstanding than it did 1 year ago.
The number of shares outstanding for TREX has been reduced compared to 5 years ago.
The debt/assets ratio for TREX is higher compared to a year ago.

2.2 Solvency

An Altman-Z score of 9.68 indicates that TREX is not in any danger for bankruptcy at the moment.
TREX has a Altman-Z score of 9.68. This is amongst the best in the industry. TREX outperforms 97.62% of its industry peers.
TREX has a debt to FCF ratio of 10.60. This is a negative value and a sign of low solvency as TREX would need 10.60 years to pay back of all of its debts.
The Debt to FCF ratio of TREX (10.60) is worse than 66.67% of its industry peers.
A Debt/Equity ratio of 0.11 indicates that TREX is not too dependend on debt financing.
With a decent Debt to Equity ratio value of 0.11, TREX is doing good in the industry, outperforming 78.57% of the companies in the same industry.

		Industry Rank	Sector Rank
Debt/Equity	0.11
Debt/FCF	10.6
Altman-Z	9.68

ROIC/WACC1.76

WACC9.15%

2.3 Liquidity

TREX has a Current Ratio of 1.20. This is a normal value and indicates that TREX is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of TREX (1.20) is worse than 88.10% of its industry peers.
A Quick Ratio of 0.67 indicates that TREX may have some problems paying its short term obligations.
The Quick ratio of TREX (0.67) is worse than 92.86% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.2
Quick Ratio	0.67

More info and screens

WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

Show peers with great health

3. Growth

3.1 Past

TREX shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -11.42%.
Measured over the past years, TREX shows a quite strong growth in Earnings Per Share. The EPS has been growing by 10.63% on average per year.
The Revenue has been growing slightly by 0.10% in the past year.
Measured over the past years, TREX shows a quite strong growth in Revenue. The Revenue has been growing by 9.09% on average per year.

EPS 1Y (TTM)-11.42%

EPS 3Y-1.7%

EPS 5Y10.63%

EPS Q2Q%37.84%

Revenue 1Y (TTM)0.1%

Revenue growth 3Y-1.28%

Revenue growth 5Y9.09%

Sales Q2Q%22.09%

3.2 Future

TREX is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -3.31% yearly.
TREX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.90% yearly.

EPS Next Y-10.34%

EPS Next 2Y-10.43%

EPS Next 3Y-3.31%

EPS Next 5YN/A

Revenue Next Year1.2%

Revenue Next 2Y2.41%

Revenue Next 3Y3.9%

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 decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

More info and screens

Find the best growth stocks

Show best growing peers

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 21.35, which indicates a rather expensive current valuation of TREX.
TREX's Price/Earnings ratio is in line with the industry average.
TREX is valuated rather cheaply when we compare the Price/Earnings ratio to 28.32, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 24.82, TREX is valued on the expensive side.
Based on the Price/Forward Earnings ratio, TREX is valued a bit more expensive than 61.90% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 25.57. TREX is around the same levels.

		Industry Rank	Sector Rank
PE	21.35
Fwd PE	24.82

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of TREX is on the same level as its industry peers.
TREX's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. TREX is more expensive than 69.05% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	423.08
EV/EBITDA	13.15

4.3 Compensation for Growth

The excellent profitability rating of TREX may justify a higher PE ratio.
A cheap valuation may be justified as TREX's earnings are expected to decrease with -3.31% in the coming years.