In a report released today, Reuben Garner from Benchmark Co. maintained a Buy rating on Trex Company, with a price target of $80.00.
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Reuben Garner has given his Buy rating due to a combination of factors that highlight Trex Company’s strong performance and future potential. Despite facing challenging weather conditions and a generally weak remodeling and renovation market, Trex reported solid second-quarter results with revenue, EBITDA, and EPS slightly surpassing expectations. The company’s ability to increase net sales by approximately 3% year-over-year is attributed to the resilience of higher-end consumers, successful new product launches, and improved market penetration through dealer and contractor conversions.
Trex’s strategic initiatives have positioned it well to continue outperforming the broader market. The company’s level load-in strategy has enhanced operating leverage and stabilized channel inventories, reducing volatility in results. Additionally, Trex is expected to benefit from operational efficiency improvements, particularly with the upcoming completion of its Arkansas facility, projected to be the most efficient in its operations. Although macroeconomic factors pose some limitations, Trex’s leadership in the composite decking space and its growth initiatives in related categories suggest a promising outlook for sustained growth.
Based on the recent corporate insider activity of 46 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of TREX in relation to earlier this year.