Core Insights - Trex Company, Inc. (TREX) is experiencing growth due to increased investments in product innovation, strategic partnerships for distribution expansion, and a focus on shareholder value [1] Financial Performance - The Zacks Consensus Estimate for TREX's 2025 earnings per share (EPS) remains at $2.20, indicating a year-over-year growth of 7.7%. The 2024 EPS estimate has increased from $2.03 to $2.05, reflecting a growth of 10.2% [2] - TREX has consistently surpassed earnings expectations over the last four quarters, with an average surprise of 9% [2] Strategic Initiatives - TREX is expanding its distribution network through strategic partnerships, aiming to reach new customers and enhance sales revenues [4][10] - The company has returned $100 million to shareholders by repurchasing 1.6 million shares during the first nine months of 2024, demonstrating a balanced capital allocation strategy [5] Product Innovation - Moving into 2025, TREX plans to launch new and enhanced products, including various railing systems and new decking colors, aiming to increase its market share in the residential railing market from 6% to 12% over the next five years [9] - Recent product launches within the last 36 months contributed approximately 18% to TREX's net sales of $984 million in the first nine months of 2024, showcasing the strength of its diversified product portfolio [18] Market Position and Efficiency - TREX's trailing 12-month return on equity (ROE) stands at 28.9%, significantly higher than the industry average of 13.4%, indicating efficient use of shareholders' funds [20] Challenges - The company faces rising selling, general, and administrative expenses, which increased by 5.2% year-over-year to $140.7 million due to various factors including branding and personnel-related costs [21]

Core Viewpoint - Trex Company, Inc. has partnered with Weyerhaeuser Company to enhance its distribution network in the Southwest, aiming to increase market share in the residential railing segment and meet growing demand for sustainable outdoor living solutions [1][2][4]. Group 1: Partnership and Distribution Expansion - The partnership with Weyerhaeuser will allow Trex to stock its full range of high-performance decking and railing products at key distribution hubs in California and Arizona [3]. - Weyerhaeuser will exclusively distribute Trex products in these regions, reinforcing Trex's focus on premium outdoor living solutions [3]. - This collaboration is part of Trex's strategy to leverage Weyerhaeuser's extensive distribution network to reach more customers [4]. Group 2: Market Position and Growth Strategy - Trex aims to increase its share in the $3.3 billion residential railing market from 6% to 12% within the next five years [5]. - The updated product portfolio includes diverse materials such as steel, aluminum, cable, glass, and composite systems to cater to various customer preferences [6]. - The strategic partnership with Weyerhaeuser marks a significant step in Trex's growth strategy, enhancing its offerings in the railing segment [6]. Group 3: Recent Developments and Performance - Trex has expanded its distribution network in Canada through a partnership with Alexandria Moulding, enhancing access to its products [7]. - The company has also strengthened its partnership with Boise Cascade Company, becoming the exclusive brand of composite decking and railings sold through participating locations nationwide [7]. - Trex's stock has gained 20.1% in the past three months, outperforming the Zacks Building Products - Wood industry's growth of 10.7% [9].

Core Insights - Trex Company, Inc. has expanded its distribution network in Canada through a partnership with Alexandria Moulding, aiming to enhance access to its outdoor living solutions for Canadian retailers, homeowners, and contractors [1][2][3] Group 1: Partnership and Market Expansion - The collaboration with Alexandria Moulding is a significant milestone for Trex, allowing the company to leverage extensive distribution capabilities to meet the growing demand for eco-friendly, low-maintenance products in Canada [2][3] - This partnership is expected to strengthen Trex's footprint in Canada and support the ongoing trend of outdoor living solutions [3] Group 2: Product Development and Financial Performance - Trex has seen a 26.8% increase in stock price over the past three months, outperforming the Zacks Building Products - Wood industry's growth of 16.1%, driven by robust demand and cost-reduction efforts [5] - Recent product innovations, including new railing systems and decking colors, align with consumer preferences and support Trex's strategic goal of doubling its share of the railing market in the next five years [6][7] Group 3: Additional Partnerships - In November, Trex strengthened its partnership with Boise Cascade Company, becoming the exclusive brand of composite decking and railings sold through participating Boise locations nationwide [8] - Earlier in June, Trex entered a strategic partnership with Paragon Stairs, designating them as the exclusive supplier for its Trex Spiral Stairs collection [9]

Core Insights - Trex Company, Inc. has strengthened its partnership with Boise Cascade Company, becoming the exclusive brand of composite decking and railings sold through participating Boise locations nationwide [1] - The company has significantly expanded its product offerings, filling product gaps and developing a well-structured portfolio to enhance competitiveness in key decking and railing categories [2] - Trex's distribution network is robust, with products available in over 6,700 retail outlets across six continents [2] Product Development - Trex has expanded its decking portfolio with new products such as Trex Signature and Trex Transcend Lineage, along with a full collection of Trex-branded deck fasteners [3] - The company has introduced a wide range of new railing profiles and materials, making its collection the largest and most diverse in the category [3] - Recent innovations include steel, mesh, and aluminum railing systems, as well as heat-mitigating technology in new decking colors, aligning with consumer preferences [5] Financial Performance - Trex's stock has gained 11.3% in the past month, outperforming the Zacks Building Products - Wood industry's growth of 4.3% [4] - The Zacks Consensus Estimate for 2024 indicates a 4.3% growth in sales and a 10.2% growth in earnings per share (EPS) year-over-year [5] - The company has delivered a trailing four-quarter earnings surprise of 9% on average [5] Market Position - Trex aims to double its share of the railing market within five years, supported by its product expansion strategy [5] - The company currently holds a Zacks Rank of 3 (Hold) [6]

Core Insights - Trex's stock has experienced significant volatility over the past year, fluctuating from $60 to $100 and back to around $70 [1] Group 1: Stock Performance - The stock price of Trex has seen a notable increase and decrease, indicating a rollercoaster ride for investors [1] Group 2: Investment Philosophy - The investment strategy focuses on achieving returns that exceed the historical S&P return of 7-8% per year, emphasizing a GARP (Growth at a Reasonable Price) approach [2] - The analysis is primarily centered on consumer discretionary stocks, with occasional coverage of tech stocks when the business model is understood [2] - The process of researching companies includes analyzing financial statements, listening to earnings calls, and reviewing Investor Relations websites to develop a comprehensive investment thesis [2]

For Immediate Release Chicago, IL – October 30, 2024 – Today, Zacks Equity Research like Trex Company, Inc. (TREX) , LouisianaPacific Corp. (LPX) and JELD-WEN Holding, Inc. (JELD) . Industry: Building Products - Wood Link: https://www.zacks.com/commentary/2359424/3-wood-stocks-to-navigate-challenging-industry-landscape Spending on home repair and remodel (R&R) activities has decreased from the peaks seen during the pandemic, given high rates. Higher mortgage rates have resulted in a substantial number of po ...

Financial Data and Key Metrics Changes - In Q3 2024, net sales were $234 million, a decrease of 23% compared to $304 million in Q3 2023, primarily due to a $70 million reduction in channel inventory [17] - Gross margin was 39.9%, down 190 basis points from 41.8% in the prior year, attributed to lower utilization rates [17] - Net income was $41 million or $0.37 per diluted share, a decrease of 38% from $65 million or $0.60 per diluted share in Q3 2023 [19] - Year-to-date net sales totaled $984 million, a 9% increase compared to $899 million in the first nine months of 2023 [20] - EBITDA was $331 million or 33.7% of net sales, up from $285 million in the prior year, with EBITDA margin expanding by 200 basis points [21] Business Line Data and Key Metrics Changes - Sell-through for premium products increased at a high single-digit rate in Q3, while lower-priced products remained stable [6] - New product development accounted for approximately 18% of year-to-date net sales, indicating strong alignment with consumer preferences [8] Market Data and Key Metrics Changes - The company expects the repair and remodel market to return to low single-digit growth in 2025, supported by lower interest rates and increased home turnover [15] - The residential railing market is projected to grow, with Trex aiming to double its market share from approximately 6% to 12% over the next five years [9][73] Company Strategy and Development Direction - New product launches are a strategic priority, with a focus on expanding the railing portfolio and entering adjacent markets [8][12] - The Arkansas facility development is critical for future growth, with production efficiencies expected to significantly increase capacity [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in capturing long-term growth opportunities, citing strong brand awareness and a trusted distribution network [29] - The company anticipates continued challenges in the repair and remodel market but expects to outperform the market due to new product introductions [15][27] Other Important Information - The company has returned over $100 million to shareholders through stock repurchases and invested $152 million in capital expenditures year-to-date [23] - The total capital expenditure for the Arkansas facility is expected to be approximately $550 million, with $340 million already invested [23] Q&A Session Summary Question: What are the assumptions for Q4 sell-through? - Management indicated that premium products are expected to sell through at a high single-digit rate, while entry-level products are anticipated to decline in the mid-single digits [31] Question: How does the EBITDA margin guide for '25 exceed 31%? - The guidance excludes one-time costs and is based on continued margin expansion due to cost reductions [32] Question: Why is inventory days on hand higher than historical levels? - The increase is attributed to new product launches and a strategic decision to maintain higher inventory levels to reduce operational fluctuations [33] Question: What is the expected channel inventory reduction in Q4? - The company expects a reduction of $20 million to $30 million primarily in the distribution channel [36] Question: What are the implications of the recycled plastic startup in Arkansas? - The startup will replace the need for purchasing external pelletized recycled materials, leading to cost benefits [37] Question: What is the expected impact of the railing transition costs? - The transition costs are associated with merchandising and launching new products, with a focus on ensuring proper market introduction [38] Question: How does the company view the differentiation in sell-through between premium and entry-level products? - The differentiation is largely demographic, with entry-level consumers being more affected by economic conditions [52] Question: What is the expected growth for the R&R market in 2025? - The company expects low single-digit growth for the R&R market based on current market conditions [50] Question: Will there be a pre-buy program in 2025? - Yes, there will be a pre-buy program, but it is expected to be smaller than in previous years due to current inventory levels [56]

Trex (TREX) came out with quarterly earnings of $0.37 per share, beating the Zacks Consensus Estimate of $0.32 per share. This compares to earnings of $0.57 per share a year ago. These figures are adjusted for nonrecurring items. This quarterly report represents an earnings surprise of 15.63%. A quarter ago, it was expected that this maker of fencing and decking products would post earnings of $0.79 per share when it actually produced earnings of $0.80, delivering a surprise of 1.27%. Over the last four qua ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-14649 Trex Company, Inc. (Exact name of registrant as specified in its charter) Delaware 54-1910453 (State or other jurisdiction of in ...

NEWS RELEASE TREX COMPANY REPORTS THIRD QUARTER 2024 RESULTS Continued Strength in Consumer Demand for Premium Products New Railing Product Introductions to Accelerate Market Share Gains Provides Update on New Arkansas Facility Reaffirms Full Year 2024 Sales Guidance and Expects to Achieve High End of EBITDA Guidance Range WINCHESTER, Va. –October 28, 2024– Trex Company, Inc. (NYSE:TREX), the world's largest manufacturer of wood-alternative decking and railing, and a leader in high-performance, lowmaintenan ...