| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 31 | 29.5x | 17.3x | Bottom tier | |
Growth | 40 | 7.0% | 7.1% | Bottom tier | |
Quality | 76 | 13.6% | 4.5% | Top tier | |
Safety | 88 | 0.9x | 2.6x | Top tier | |
Capital Return | 49 | 0.00% | 0.06% | Around median | |
Momentum | 74 | -18.7% | -1.6% | Top tier | |
Sentiment | 68 | 13 | 3 | Top tier |
The floor: what the company is worth if growth stopped today
75% of today's price is what a buyer pays for growth that has not happened yet.
10-year US Treasury yield 4.96% as of 2026-10-22. Estimates computed from company data and analyst targets, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Trex Company manufactures and markets outdoor living products, led by decking boards, railing products, and fasteners, targeting contractors and homeowners through a North American distribution network and home improvement center channels. Its growth strategy relies on converting demand from wood to Trex products, particularly Trex Enhance Basic at the entry-level price point, alongside expanding its PVC portfolio through Trex Refuge. According to management, wood still represents approximately 75% of the decking category, and every percentage point Trex captures from wood represents an additional revenue opportunity of approximately $80 million.
In fiscal Q2 2026, revenue reached $418.0 million, up 8% year over year, driven primarily by higher volume with a limited pricing impact. Gross profit was $158.3 million, equivalent to a gross margin of approximately 37.9%, while net income reached $61.9 million and earnings per share were $0.60. The company also generated adjusted EBITDA of $112 million, while a $5 million non-cash write-off of obsolete equipment reduced adjusted earnings per share by $0.03.
Growth was broad-based across product lines, distributors, and price points; railing sales returned to double-digit growth, and Trex Enhance Basic recorded its first meaningful sales increase at this price point in several years. On a trailing twelve-month basis ending in fiscal 2026, EDGAR data showed revenue of approximately $1.2 billion, gross profit of approximately $461.5 million, and net income of $177.4 million. Selling, general, and administrative expenses in fiscal Q2 2026 were approximately $67 million, or 16.1% of sales, compared with an annual target of approximately 18% of sales.
The analyst consensus on TREX stock is “Neutral,” with an average price target of $52.89 and a wide range of $42 to $61, reflecting meaningful differences in estimates of the demand and margin trajectory. The average target is approximately 20% below the 52-week high of $66.06, while the annual range extends from $29.77 to $66.06; the revaluation appears tied to balancing accelerating demand and Little Rock opportunities on one hand against margin weakness and the risk of a fiscal Q4 2026 slowdown on the other.
Figures in the text are as of 2026-08-30; the live price is shown at the top of the page.
Revenue increased 8% to $418 million, with growth driven primarily by volume and a limited pricing impact. Performance was broad-based across products, distributors, and price points, and railing sales returned to double-digit growth. Trex Enhance Basic also recorded its first meaningful increase at this price point in several years, while demand accelerated during May and June 2026. On a trailing twelve-month basis, sell-in increased 9% and sell-out increased 7%.
Trex accelerated the facility's startup by more than six months and is targeting bringing half of its lines into production by the end of fiscal 2026. Management describes Little Rock as its most efficient and lowest-cost plant, while its location serves markets in the southern United States and reduces shipping costs to the central part of the country. At full operation, the company's network can support revenue of $1.8–2.0 billion. Management expects most of the margin benefit to emerge in fiscal 2027 and beyond as line utilization increases.
Automated analysis for informational purposes only — not investment advice.
Management estimates that wood still represents approximately 75% of the decking category, with Southern Yellow Pine dominating most wood sales. It says every percentage point Trex captures from wood represents an additional revenue opportunity of approximately $80 million. Trex Enhance Basic is the primary tool for this conversion and achieved meaningful growth in fiscal Q2 2026. The company supports this strategy with investments in branding, marketing, and sales programs targeting consumers and contractors.
Gross margin was 37.9% in fiscal Q2 2026, affected by a higher mix of railing and entry-level products, as well as Little Rock depreciation. Accelerating production during May and June 2026 led to overtime, more line changeovers, and temporary inefficiencies that reduced margin by more than 100 basis points. Management said efficiency improved by the end of June and that exit margins for the month exceeded the quarterly average. Nevertheless, the company expects fiscal Q3 2026 adjusted gross margin to decline sequentially by approximately 30–40 basis points.
The company raised its outlook following first-half results and improved demand, setting fiscal Q3 2026 revenue guidance at $305–320 million. It expects fiscal 2026 adjusted EBITDA of $335–350 million and an adjusted gross margin of approximately 38%, compared with a previous forecast of 37.5%. The outcome within this range depends primarily on end-market demand and product mix. Management explained that a continuation of July 2026 trends could support the upper end, while geopolitical disruptions could pressure the lower end.
Trex generated $182 million in free cash flow in fiscal Q2 2026 as capital expenditures declined and construction of Little Rock approached completion. It used approximately $51 million to repurchase shares and $130 million to repay the outstanding balance on its credit facility. It also plans to repurchase up to an additional $150 million during the remainder of fiscal 2026. Going forward, management is balancing repurchases, investment in the business, and selective acquisitions based on return on invested capital.