Trex (NYSE:TREX) Hits New 1-Year High - Should You Buy?

Key Points

• Trex shares hit a new 52-week high of $51.12 and recently traded near $50.80, up 2.6%, with the stock above its 50-day and 200-day moving averages.
• Analyst opinions remain mixed: 13 rate Trex a Buy, eight Hold, and two Sell, producing a consensus Hold rating and an average price target of $50.48. Several firms recently raised their targets, including UBS at $61 and Truist at $60.
• Trex reported quarterly revenue of $418.02 million, up 7.8% year over year and above expectations, but EPS of $0.62 slightly missed estimates and declined from $0.71 a year earlier. Institutional investors own 95.96% of the stock, while an insider recently sold shares.

Trex Company, Inc. (NYSE:TREX - Get Free Report) shares reached a new 52-week high during trading on Thursday. The stock traded as high as $51.12 and last traded at $50.80, with a volume of 167,892 shares traded. The stock had previously closed at $49.54.

Wall Street Analysts Forecast Growth

A number of analysts have recently issued reports on the stock. The Goldman Sachs Group reissued a "buy" rating and set a $56.00 target price (up from $49.00) on shares of Trex in a research note on Friday, July 10th. Citigroup reissued a "neutral" rating and set a $52.00 price target (up from $43.00) on shares of Trex in a research report on Wednesday, July 15th. UBS Group reissued a "buy" rating and issued a $61.00 price target (up from $59.00) on shares of Trex in a report on Tuesday, July 14th. Stifel Nicolaus set a $55.00 price objective on shares of Trex and gave the stock a "buy" rating in a research note on Monday, October 19th. Finally, Truist Financial boosted their target price on shares of Trex from $55.00 to $60.00 and gave the company a "buy" rating in a research note on Tuesday, July 14th. Thirteen research analysts have rated the stock with a Buy rating, eight have issued a Hold rating and two have assigned a Sell rating to the company's stock. According to MarketBeat.com, the stock presently has a consensus rating of "Hold" and an average target price of $50.48.

Trex Stock Up 2.6%

The stock has a fifty day moving average price of $45.48 and a 200-day moving average price of $43.07. The firm has a market cap of $5.28 billion, a price-to-earnings ratio of 30.23, a price-to-earnings-growth ratio of 2.92 and a beta of 1.48.

Trex (NYSE:TREX - Get Free Report) last issued its quarterly earnings data on Tuesday, August 4th. The construction company reported $0.62 earnings per share (EPS) for the quarter, missing the consensus estimate of $0.63 by ($0.01). Trex had a net margin of 14.68% and a return on equity of 18.03%. The company had revenue of $418.02 million during the quarter, compared to analysts' expectations of $415.71 million. During the same quarter in the prior year, the company earned $0.71 earnings per share. The firm's revenue was up 7.8% compared to the same quarter last year. As a group, research analysts expect that Trex Company, Inc. will post 1.77 earnings per share for the current year.

Insider Activity

In related news, SVP Amy M. Fernandez sold 1,050 shares of Trex stock in a transaction dated Friday, August 7th. The stock was sold at an average price of $50.07, for a total transaction of $52,573.50. Following the transaction, the senior vice president directly owned 67,794 shares of the company's stock, valued at $3,394,445.58. The trade was a 1.53% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at the SEC website. Corporate insiders own 0.93% of the company's stock.

Institutional Investors Weigh In On Trex

Institutional investors have recently added to or reduced their stakes in the stock. BlackRock Inc. bought a new stake in Trex during the second quarter worth $525,081,000. Wellington Management Group LLP raised its position in shares of Trex by 18.2% in the 2nd quarter. Wellington Management Group LLP now owns 9,877,116 shares of the construction company's stock worth $494,251,000 after purchasing an additional 1,518,338 shares during the last quarter. Bank of America Corp DE purchased a new stake in shares of Trex during the 2nd quarter valued at about $94,851,000. Freestone Grove Partners LP purchased a new position in Trex in the second quarter worth about $36,197,000. Finally, Fort Washington Investment Advisors Inc. OH bought a new stake in shares of Trex during the 3rd quarter valued at $32,858,000. 95.96% of the stock is owned by institutional investors and hedge funds.

About Trex

Trex Company, Inc is a manufacturer of composite decking and outdoor living products. Its offerings are designed as alternatives to traditional wood and include residential and commercial decking, railing systems, outdoor lighting, and related accessories.

The company's products are marketed under the Trex brand and include decking lines such as Trex Transcend, Trex Select, and Trex Enhance. Trex composite products are made primarily from recycled wood fibers and recycled polyethylene plastics, supporting the company's focus on low-maintenance and environmentally oriented outdoor building materials.

Founded in 1996 and headquartered in Winchester, Virginia, Trex serves customers through a network of distributors, dealers, retailers, contractors, and building professionals.

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