TREX COMPANY INC (TREX) Stock Fundamental Analysis
NYSE:TREX - New York Stock Exchange, Inc. - US89531P1057 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to TREX. TREX was compared to 41 industry peers in the Building Products industry. While TREX has a great profitability rating, there are some minor concerns on its financial health. TREX is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
TREX had positive earnings in the past year.
TREX had a positive operating cash flow in the past year.
TREX had positive earnings in each of the past 5 years.
TREX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a decent Return On Assets value of 12.05%, TREX is doing good in the industry, outperforming 73.17% of the companies in the same industry.
TREX's Return On Equity of 21.73% is fine compared to the rest of the industry. TREX outperforms 73.17% of its industry peers.
TREX has a Return On Invested Capital of 13.42%. This is in the better half of the industry: TREX outperforms 70.73% 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 12.71%.
The last Return On Invested Capital (13.42%) 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 | 12.05% | ||
| ROE | 21.73% | ||
| ROIC | 13.42% |
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's Profit Margin of 17.69% is amongst the best of the industry. TREX outperforms 90.24% of its industry peers.
In the last couple of years the Profit Margin of TREX has remained more or less at the same level.
With an excellent Operating Margin value of 24.00%, TREX belongs to the best of the industry, outperforming 97.56% of the companies in the same industry.
In the last couple of years the Operating Margin of TREX has remained more or less at the same level.
Looking at the Gross Margin, with a value of 40.60%, TREX is in the better half of the industry, outperforming 78.05% 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 | 24% | ||
| PM (TTM) | 17.69% | ||
| GM | 40.6% |
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%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so TREX is creating value.
The number of shares outstanding for TREX has been reduced compared to 1 year ago.
Compared to 5 years ago, TREX has less shares outstanding
The debt/assets ratio for TREX is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 7.38 indicates that TREX is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 7.38, TREX belongs to the top of the industry, outperforming 87.80% of the companies in the same industry.
A Debt/Equity ratio of 0.49 indicates that TREX is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.49, TREX is in line with its industry, outperforming 58.54% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 7.38 |
ROIC/WACC1.33
WACC10.07%
2.3 Liquidity
A Current Ratio of 0.98 indicates that TREX may have some problems paying its short term obligations.
With a Current ratio value of 0.98, TREX is not doing good in the industry: 90.24% of the companies in the same industry are doing better.
A Quick Ratio of 0.69 indicates that TREX may have some problems paying its short term obligations.
The Quick ratio of TREX (0.69) is worse than 92.68% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.69 |
3. Growth
3.1 Past
TREX shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -18.70%.
TREX shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.63% yearly.
TREX shows a decrease in Revenue. In the last year, the revenue decreased by -9.10%.
TREX shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.09% yearly.
EPS 1Y (TTM)-18.7%
EPS 3Y-1.7%
EPS 5Y10.63%
EPS Q2Q%-25.61%
Revenue 1Y (TTM)-9.1%
Revenue growth 3Y-1.28%
Revenue growth 5Y9.09%
Sales Q2Q%-9%
3.2 Future
TREX is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.93% yearly.
Based on estimates for the next years, TREX will show a quite strong growth in Revenue. The Revenue will grow by 8.07% on average per year.
EPS Next Y7.92%
EPS Next 2Y10.59%
EPS Next 3Y10.93%
EPS Next 5YN/A
Revenue Next Year7.03%
Revenue Next 2Y7.44%
Revenue Next 3Y8.07%
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 stable.
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
Based on the Price/Earnings ratio of 30.84, the valuation of TREX can be described as expensive.
Based on the Price/Earnings ratio, TREX is valued a bit more expensive than 70.73% of the companies in the same industry.
TREX's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.21.
A Price/Forward Earnings ratio of 22.68 indicates a rather expensive valuation of TREX.
Based on the Price/Forward Earnings ratio, TREX is valued a bit more expensive than 60.98% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.70. TREX is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.84 | ||
| Fwd PE | 22.68 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, TREX is valued a bit more expensive than 63.41% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 18.03 |
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.
TREX has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)3.89
PEG (5Y)2.9
EPS Next 2Y10.59%
EPS Next 3Y10.93%
5. Dividend
5.1 Amount
No dividends for TREX!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
57.68
+3.3 (+6.07%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryBuilding Products
Earnings (Last)
Earnings (Next)
Inst Owners110.94%
Inst Owner Change4.07%
Ins Owners0.64%
Ins Owner Change7.33%
Market Cap6.19B
Analysts72
Price Target69.23 (20.02%)
Short Float %8.4%
Short Ratio6.01
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)48.06%
Min EPS beat(2)0.78%
Max EPS beat(2)95.34%
EPS beat(4)4
Avg EPS beat(4)27.67%
Min EPS beat(4)0.78%
Max EPS beat(4)95.34%
EPS beat(8)8
Avg EPS beat(8)21%
EPS beat(12)10
Avg EPS beat(12)10.37%
EPS beat(16)13
Avg EPS beat(16)9.66%
Revenue beat(2)2
Avg Revenue beat(2)1.92%
Min Revenue beat(2)1.35%
Max Revenue beat(2)2.48%
Revenue beat(4)3
Avg Revenue beat(4)0.16%
Min Revenue beat(4)-4.84%
Max Revenue beat(4)2.48%
Revenue beat(8)5
Avg Revenue beat(8)1.55%
Revenue beat(12)6
Avg Revenue beat(12)0.78%
Revenue beat(16)9
Avg Revenue beat(16)0.74%
PT rev (1m)-2.21%
PT rev (3m)-11.16%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-9.38%
EPS NY rev (1m)0.19%
EPS NY rev (3m)0.37%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)-0.41%
Revenue NY rev (1m)0.16%
Revenue NY rev (3m)0.08%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 30.84 | ||
| Fwd PE | 22.68 | ||
| P/S | 5.53 | ||
| P/FCF | N/A | ||
| P/OCF | 37.72 | ||
| P/B | 6.8 | ||
| P/tB | 6.98 | ||
| EV/EBITDA | 18.03 |
EPS(TTM)1.87
EY3.24%
EPS(NY)2.54
Fwd EY4.41%
FCF(TTM)-1.07
FCFYN/A
OCF(TTM)1.53
OCFY2.65%
SpS10.42
BVpS8.49
TBVpS8.27
PEG (NY)3.89
PEG (5Y)2.9
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 12.05% | ||
| ROE | 21.73% | ||
| ROCE | 25.81% | ||
| ROIC | 13.42% | ||
| ROICexc | 13.47% | ||
| ROICexgc | 13.68% | ||
| OM | 24% | ||
| PM (TTM) | 17.69% | ||
| GM | 40.6% | ||
| FCFM | N/A |
ROA(3y)19.63%
ROA(5y)20.87%
ROE(3y)30.3%
ROE(5y)29.91%
ROIC(3y)21.94%
ROIC(5y)24.11%
ROICexc(3y)22.08%
ROICexc(5y)26.54%
ROICexgc(3y)22.55%
ROICexgc(5y)28.02%
ROCE(3y)34.9%
ROCE(5y)35.69%
ROICexcg growth 3Y-18.02%
ROICexcg growth 5Y-16.48%
ROICexc growth 3Y-17.77%
ROICexc growth 5Y-12.92%
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%
F-Score4
Asset Turnover0.68
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.49 | ||
| Debt/FCF | N/A | ||
| Debt/EBITDA | 1.37 | ||
| Cap/Depr | 509.53% | ||
| Cap/Sales | 24.96% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 50.75% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.98 | ||
| Quick Ratio | 0.69 | ||
| Altman-Z | 7.38 |
F-Score4
WACC10.07%
ROIC/WACC1.33
Cap/Depr(3y)387.2%
Cap/Depr(5y)514.08%
Cap/Sales(3y)17.22%
Cap/Sales(5y)16.92%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-18.7%
EPS 3Y-1.7%
EPS 5Y10.63%
EPS Q2Q%-25.61%
EPS Next Y7.92%
EPS Next 2Y10.59%
EPS Next 3Y10.93%
EPS Next 5YN/A
Revenue 1Y (TTM)-9.1%
Revenue growth 3Y-1.28%
Revenue growth 5Y9.09%
Sales Q2Q%-9%
Revenue Next Year7.03%
Revenue Next 2Y7.44%
Revenue Next 3Y8.07%
Revenue Next 5YN/A
EBIT growth 1Y-20.68%
EBIT growth 3Y-1.61%
EBIT growth 5Y10.19%
EBIT Next Year27.47%
EBIT Next 3Y16.63%
EBIT Next 5YN/A
FCF growth 1Y30.78%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y510.2%
OCF growth 3Y-17.69%
OCF growth 5Y-1.65%