Comparing Trex (TREX) and Its Peers

Trex (NYSE:TREX) is one of 93 publicly-traded companies in the “Building Products” industry, but how does it compare to its peers? We will compare Trex to similar companies based on the strength of its dividends, valuation, profitability, institutional ownership, risk, analyst recommendations and earnings.

Profitability

This table compares Trex and its peers’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Trex	13.89%	18.27%	11.60%
Trex Competitors	3.72%	-38.07%	5.08%

Insider and Institutional Ownership

96.0% of Trex shares are owned by institutional investors. Comparatively, 63.6% of shares of all “Building Products” companies are owned by institutional investors. 0.9% of Trex shares are owned by insiders. Comparatively, 10.2% of shares of all “Building Products” companies are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Volatility & Risk

Trex has a beta of 1.46, suggesting that its stock price is 46% more volatile than the S&P 500. Comparatively, Trex’s peers have a beta of 1.07, suggesting that their average stock price is 7% more volatile than the S&P 500.

Analyst Ratings

This is a summary of recent recommendations for Trex and its peers, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Trex	1	6	12	0	2.58
Trex Competitors	745	3944	5078	241	2.48

Trex currently has a consensus target price of $55.18, suggesting a potential upside of 3.90%. As a group, “Building Products” companies have a potential upside of 25.89%. Given Trex’s peers higher probable upside, analysts clearly believe Trex has less favorable growth aspects than its peers.

Earnings & Valuation

This table compares Trex and its peers revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Trex	$1.17 billion	$190.41 million	30.88
Trex Competitors	$4.00 billion	$4.65 billion	39.43

Trex’s peers have higher revenue and earnings than Trex. Trex is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Summary

Trex beats its peers on 7 of the 13 factors compared.

About Trex

Trex Company, Inc. manufactures wood-alternative decking, railing and other outdoor-living products. Its composite decking is made primarily from reclaimed wood and recycled plastic, offering an alternative to traditional wood materials. The company’s products include composite deck boards and railing systems, along with accessories such as outdoor lighting and drainage products. Trex sells through a network of distributors, dealers and retailers, serving customers primarily in North America as well as international markets.