Trex (NYSE:TREX) Issues Earnings Results, Misses Expectations By $0.01 EPS

Trex (NYSE:TREX) announced its quarterly earnings data on Tuesday. The construction company reported $0.62 EPS for the quarter, missing analysts’ consensus estimates of $0.63 by ($0.01), FiscalAI reports. The firm had revenue of $418.02 million during the quarter, compared to analyst estimates of $415.71 million. Trex had a return on equity of 19.66% and a net margin of 16.25%.Trex’s revenue for the quarter was up 7.8% compared to the same quarter last year. During the same quarter in the previous year, the business earned $0.71 earnings per share.

Here are the key takeaways from Trex’s conference call:

• Second-quarter net sales rose 8% to $418 million, exceeding expectations, with broad-based strength across products, channels, and price points. Sell-through remained healthy and demand accelerated through May and June, continuing into the third quarter.
• Trex raised its full-year 2026 guidance, including adjusted gross margin of approximately 38%, and authorized up to an additional $150 million in share repurchases. Strong quarterly free cash flow of $182 million also enabled $130 million of debt repayment.
• The company accelerated the Little Rock plant’s decking ramp by more than six months, with roughly half of its lines expected to be in production by year-end. Management expects the facility to become margin-accretive as utilization rises, with most benefits arriving in 2027 and beyond.
• Trex sees substantial growth potential from converting wood decking customers and replacing tertiary brands, citing more than $100 million of tertiary-brand business across its distribution network and approximately $80 million of opportunity for every 1% of wood-decking share gained.
• Second-quarter gross margin fell to 37.9% due to unfavorable product mix, Little Rock depreciation, and more than 100 basis points of temporary manufacturing inefficiencies from rapidly increasing production. Management also included geopolitical uncertainty in its outlook, making demand and mix the key swing factors for reaching the high or low end of its EBITDA guidance.

Trex Price Performance

Shares of TREX stock opened at $44.69 on Tuesday. The stock has a market cap of $4.64 billion, a P/E ratio of 24.96, a P/E/G ratio of 4.98 and a beta of 1.48. The company has a fifty day moving average price of $44.93 and a two-hundred day moving average price of $41.78. Trex has a one year low of $29.77 and a one year high of $66.36.

Wall Street Analysts Forecast Growth

TREX has been the topic of several recent research reports. Deutsche Bank Aktiengesellschaft reaffirmed a “hold” rating and issued a $51.00 target price (up from $41.00) on shares of Trex in a research note on Tuesday, July 14th. Zelman & Associates upgraded shares of Trex from a “neutral” rating to an “outperform” rating and set a $50.00 target price for the company in a research report on Monday, May 18th. Bank of America increased their price target on Trex from $42.00 to $44.00 and gave the company an “underperform” rating in a research note on Tuesday, July 14th. Zacks Research upgraded Trex from a “hold” rating to a “strong-buy” rating in a research report on Wednesday, July 15th. Finally, UBS Group reaffirmed a “buy” rating and set a $61.00 price objective (up from $59.00) on shares of Trex in a research note on Tuesday, July 14th. One analyst has rated the stock with a Strong Buy rating, ten have issued a Buy rating, nine have issued a Hold rating and two have issued a Sell rating to the company’s stock. According to MarketBeat.com, Trex currently has a consensus rating of “Hold” and an average price target of $49.15.

Insider Buying and Selling at Trex

In other news, SVP Jacob T. Rudolph sold 1,400 shares of the company’s stock in a transaction dated Thursday, June 25th. The shares were sold at an average price of $50.00, for a total value of $70,000.00. Following the sale, the senior vice president directly owned 36,631 shares of the company’s stock, valued at approximately $1,831,550. This represents a 3.68% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. 0.93% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On Trex

A number of institutional investors have recently bought and sold shares of the business. AQR Capital Management LLC grew its holdings in shares of Trex by 3.2% during the first quarter. AQR Capital Management LLC now owns 5,642 shares of the construction company’s stock worth $320,000 after purchasing an additional 177 shares during the last quarter. Benjamin Edwards Inc. raised its holdings in shares of Trex by 1.9% in the second quarter. Benjamin Edwards Inc. now owns 11,240 shares of the construction company’s stock valued at $611,000 after buying an additional 214 shares during the last quarter. Hsbc Holdings PLC raised its holdings in shares of Trex by 6.3% in the second quarter. Hsbc Holdings PLC now owns 5,403 shares of the construction company’s stock valued at $294,000 after buying an additional 322 shares during the last quarter. Nicolet Advisory Services LLC lifted its position in Trex by 5.4% during the 3rd quarter. Nicolet Advisory Services LLC now owns 9,276 shares of the construction company’s stock worth $488,000 after buying an additional 478 shares in the last quarter. Finally, Curi Capital LLC grew its holdings in Trex by 0.9% during the 2nd quarter. Curi Capital LLC now owns 63,431 shares of the construction company’s stock worth $3,449,000 after acquiring an additional 550 shares during the last quarter. Institutional investors and hedge funds own 95.96% of the company’s stock.

About Trex

Trex Company, Inc is a leading manufacturer of wood-alternative decking and railing systems designed for residential and commercial outdoor living environments. The company’s core offerings feature composite decking products made from a proprietary blend of recycled wood fibers and plastic film, which deliver enhanced durability, resistance to rot and insect damage, and low maintenance compared to traditional wood. Trex also provides matching railing, lighting, fencing and cladding solutions that allow customers to create cohesive, high-performance outdoor spaces.

Trex’s product portfolio is organized into multiple performance tiers, including premium, mid-range and value-oriented lines.