TREX - Trex Company Is A Fantastic Stock But Its Valuation Is Excessive
- I gather TREX continues to deliver shareholder value because of its superior product offerings.
- In my view, the company is poised for many more years of double-digit revenue growth, as it has ample opportunities in the US and globally.
- Moreover, TREX is an FCF machine that has consistently grown its operations over time. I believe this trend will continue over the next few years.
- Unfortunately, the company's valuation is too expensive to be a viable investment. My optimistic valuation model suggests the company is worth, at best, just $43.26 per share.
- I estimate the company's downside potential at these levels is roughly 39.1%. Therefore, I consider it's better to wait for a retrace before initiating a position.
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Trex Company Is A Fantastic Stock But Its Valuation Is Excessive