Trex Co Inc (TREX, Financial), a leading player in the construction industry, is currently trading at $74.99 with a market cap of $8.16 billion. The company's stock price has seen a gain of 8.46% today and a significant increase of 14.28% over the past four weeks. According to GuruFocus, Trex Co Inc has a GF Score of 98 out of 100, placing it in the highest outperformance potential category. This score is a comprehensive measure of a stock's performance potential, taking into account five key aspects: Financial Strength, Profitability Rank, Growth Rank, GF Value Rank, and Momentum Rank.
Financial Strength Analysis
Trex Co Inc's Financial Strength rank stands at 6/10. This score is a measure of the company's financial stability, taking into account its debt burden, debt to revenue ratio, and Altman Z-Score. The company's interest coverage is 64.17, indicating a low debt burden. Its debt to revenue ratio is 0.40, suggesting a healthy balance between debt and revenue. The Altman Z-Score of 10.83 further confirms the company's strong financial health.
Profitability Rank Analysis
The company's Profitability Rank is a perfect 10/10. This score is based on factors such as operating margin, Piotroski F-Score, trend of the operating margin, consistency of profitability, and Predictability Rank. Trex Co Inc's operating margin is 22.29%, and its Piotroski F-Score is 4, indicating a stable financial situation. The company has shown consistent profitability over the past 10 years, further strengthening its profitability rank.
Growth Rank Analysis
Trex Co Inc also boasts a Growth Rank of 10/10, reflecting its strong revenue and profitability growth. The company's 5-year revenue growth rate is 17.20%, and its 3-year revenue growth rate is 15.90%. Its 5-year EBITDA growth rate is an impressive 17.60%, indicating robust growth in its business operations.
GF Value Rank Analysis
The company's GF Value Rank is 9/10, suggesting that the stock is fairly valued. This rank is determined by the price-to-GF-Value ratio, a proprietary metric calculated based on historical multiples and an adjustment factor based on a company's past returns and growth.
Momentum Rank Analysis
Trex Co Inc's Momentum Rank is 9/10, reflecting the strong momentum in its stock price. This rank is determined using the standardized momentum ratio and other momentum indicators.
Competitor Analysis
When compared to its competitors, Trex Co Inc stands out with its high GF Score. Fortune Brands Innovations Inc (FBIN, Financial) has a GF Score of 75, AAON Inc (AAON, Financial) has a GF Score of 97, and Louisiana-Pacific Corp (LPX, Financial) has a GF Score of 92.
Conclusion
In conclusion, Trex Co Inc's overall GF Score of 98/100 indicates a high outperformance potential. The company's strong financial strength, profitability, growth, value, and momentum ranks suggest that it is well-positioned for future success. Investors should consider this stock for its potential for high returns.
