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Are Investors Unfairly Punishing Trex Company Inc. (NYSE:TREX)?

Trex Company Inc. (NYSE:TREX) shares traded higher over the last trading session, gaining 0.32% on 05/28/21. The shares fell to a low of $96.99 before closing at $97.41. Intraday shares traded counted 0.4 million, which was 42.37% higher than its 30-day average trading volume of 699.75K. TREX’s previous close was $97.10 while the outstanding shares total 115.66M. The firm has a beta of 1.48, a 12-month trailing P/E ratio of 62.20, and a growth ratio of 3.96. The stock’s Relative Strength Index (RSI) is 41.87, with weekly volatility at 1.91% and ATR at 2.96. The TREX stock’s 52-week price range has touched low of $54.10 and a $111.04 high.

Investors have identified the Building Products & Equipment company Trex Company Inc. as an interesting stock but before investments are made there, an in-depth look at its trading activities will have to be conducted. The share is trading with a market value of around $11.20 billion, the company now has both obstacles and catalysts that affect them and they came from their mode of operations. With the company affected by events currently, it is a perfect time to analyze the numbers behind the firm in order to come up with a rather realistic picture of what this stock is.

Trex Company Inc. (TREX) Fundamentals that are to be considered.

When analyzing a stock, the first fundamental thing to take into account is the balance sheet. How healthy the balance sheet of a company is will determine if the company will be able to carry out all its financial and non-financial obligations and also keep the faith of its investors. For TREX, the company has in raw cash 8.22 million on their books with 136.0 million currently as liabilities. How the trend is over time is what investors should be concerned about. The company has a healthy balance sheet as their debt profile has been on an incline. In terms of their assets, the company currently has 410.08 million total, with 235.63 million as their total liabilities.

TREX were able to record -200.67 million as free cash flow during the 08/02/2021 quarter of the year, this saw their quarterly net cash flow reduce by -113.48 million. In cash movements, the company had a total of -142.57 million as operating cash flow.

Potential earnings growth for Trex Company Inc. (TREX)

In order to determine the future investment potential for this stock, we will have to analyze key trends that affect it. During the 08/02/2021 quarter of the year, Trex Company Inc. recorded a total of 245.52 million in revenue. This figure implies that they witnessed a quarterly year/year change in their earnings with 18.38% coming in sequential stages and their sales for the 08/02/2021 quarter increasing by 7.02%.

What matters though is how it ends. When the core data for the company is broken down, then the stock sounds interesting. The company spent 149.72 million trying to sell their products during the last quarter, with the result yielding a gross income of 95.8 million. This allows shareholders to hold on to 115.66M with the recently reported earning now reading 0.42 cents per share. This is a figure that compared to analyst’s prediction for their 08/02/2021 (0.42 cents a share).

Having a look at the company’s valuation, the company is expected to record 2.36 total earnings per share during the next fiscal year. It is very important though to remember that the importance of trend far outweighs that of outlook. This analysis has been great and getting further updates on TREX sounds very interesting.

Is the stock of TREX attractive?

In related news, Director, GRATZ JAY M sold 2,140 shares of the company’s stock in a transaction that recorded on May 14. The sale was performed at an average price of 100.92, for a total value of 215,969. As the sale deal closes, the Director, Posey Richard E now sold 6,420 shares of the company’s stock, valued at 651,151. Also, Director, Cline James E sold 8,982 shares of the company’s stock in a deal that was recorded on May 12. The shares were price at an average price of 102.85 per share, with a total market value of 923,799. Following this completion of acquisition, the President and CEO, FAIRBANKS BRYAN HORIX now holds 4,902 shares of the company’s stock, valued at 497,125. In the last 6 months, insiders have changed their ownership in shares of company stock by 0.40%.

5 out of 15 analysts covering the stock have rated it a Buy, while 9 have maintained a Hold recommendation on Trex Company Inc.. 0 analysts has assigned a Sell rating on the TREX stock. The 12-month mean consensus price target for the company’s shares has been set at $114.08.

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