Trex Company, Inc. (TREX)

Trex stock forecast: buy or sell

Trex stock outlook

  • Trex closed today at $68.24 after skyrocketing a 2.83% and broke a streak of 3 sessions in positive.
  • Deutsche Bank published a hold rating for Trex today, targeting $72.00
  • The stock is configuring an uptrend pattern since last March, when it bottomed at $28.11. This uptrend marked a 142.76% gain
  • Trex Company, Inc. manufactures and distributes wood and plastic composite products, and related accessories for residential and commercial decking, and railing applications in the United States.
No ad for you

Disclaimer:
The thoughts published in this post are personal and not recommendations for you to buy or sell stocks. The author of this article does not have any knowledge of the particular positions of the reader, his or her own financial statements or what is in his or her best interest at any given time. All users should speak with their financial advisor before buying or selling any securities Comments are expressed for general educational motives only

Trex stock charts overview

Should I buy Trex stock?

All successful traders recommend adhering to a trading strategy and not make decisions based on subjective opinions, rumors or feelings. Trading strategies are meant for helping you in the decision process of what stocks to pick and when is the best moment to buy them. At Stocks2.com, we like to use very simple but trusted and powerful trend following trading strategies. Simple things usually work the best

Is TREX stock a buy?

In the current situation of Trex there is just one buy setup eligible:

Uptrend buy setup

Trex stock is in an uptrend since last March that so far marked an amazing 143% gain. Price marked a local bottom in this uptrend at $63.32 yesterday, and since then it bounced off a 7.77%. Breaking out over $78.32 - it's last top - will be a good entry point if Trex resumes the uptrend. If you decide to enter this trade, the suggested stop loss is at $70.49

Buy setupBuy pointStop lossRisk
Uptrend buy setup$78.32$70.4910%
No ad for you

Should I sell Trex stock?

Do you know when is it time to sell Trex stock?. Trading strategies let us to avoid rash decisions based on our personal moods or the buzz that surrounds the market. We like very simple setups to guide us on when is the best time to sell our shares. Be aware that these setups should not be used for selling short TREX stock

A guiding principle is that you should not hold a trading operation that shows a higher than expected losses at the time of purchase. The timing to sell your stock always has to be determined by the stop-loss (automatic or manual)

Is it time to sell Trex stock?

Currently, Trex stock doesn't match any of our preferred sell setups, so if you own Trex stock and your operation is in profit probably is not time to sell now

No ad for you

Analysts' recommendations to buy or sell Trex stock

Brokerage firms and financial institutions post stock ratings based on their views of the market and the fundamental and technical situation of the analyzed stock. Unfortunately, the accuracy of these predictions is not very high, and certainly not a direct buy or sell signal

In the last 30 days, just one brokerage rating was published for Trex

No ad for you

Trex ratings

Brokerage firmRating
Sep 22nd, 2020
Deutsche Bank Neutral

Technical analysis

Trex shares started an uptrend last March, and gained an amazing 142.76%. During this uptrend, the price offered some entry points on the breakouts. Latest pullback was yesterday, when price bounced at $63.32. Currently, it swings in a consolidation between its last top ($78.32) and its last bottom ($63.32)

SMAs overview

Moving averages are tools for investors to gauge direction. A moving average is calculated as the simple mean of the previous N periods (usually sessions). Usual time periods used for moving averages are 21 days, 50 days, 100 days and 200 days

Supports and resistances

Technical analysts use support and resistance levels to identify price points on a chart that tend to act as obstacles, containing the price of shares to move in certain direction. Supports are levels where the price may stop as it falls. Price is more likely to "bounce off" this level rather than break through it. However, if the price breaks down the support, it is likely to continue descending until approaching another support level. In contrast, resistance levels are where the price tends to find resistance as it moves up. Likewise, this means that the price is more liable to "rebound" at this level, and if it finally breaks this level, the price will rise easily until it finds the next resistance

The current resistance levels are:

  • R1: $78.32 (14.77% above)
  • The current support levels are:

  • S1: $66.42 (-2.67% below)
  • S2: $63.32 (-7.21% below)
  • S3: $55.92 (-18.05% below)
  • Bollinger bands

    This is an indicator that was designed in the 1980s by John Bollinger. The Bollinger Bands are lines that fluctuate around a moving average, varying the distance from the bottom to the top depending on market volatility. They are usually drawn by an interval of two standard deviations, above and below, from a moving average line. Bollinger himself recommends the moving average period to be 20

    Since the price broke down the lower band on September 11, the price bounced off by 3.1%

    Relative strength index

    The relative strength index (RSI) is a technical indicator used in the analysis of financial markets. It is intended to map the current and past strength or weakness of a stock or market based on the closing prices of a recent trading period. Oscillator indicators, such as relative strength, are intended to indicate values in the range of 0-100. The relative strength indicator is one of the best known and most widely used indicators, invented by J. Welles Wilder in the late 1970s

    The Relative Strength Indicator (RSI) has been between the the levels of 30 and 70 for some weeks, and therefore, without this indicator really being of any help to us in making any decisions.

    No ad for you

    Earnings and financials

    In early August, Trex had the quarterly earnings call and presented the Q2 report. Trex presented 2nd-quarter earnings of $0.81 per share on sales of $220.6 million. The Wall St estimate was $0.65 per share on revenue of $199.5 million.

    Compared to the same quarter one year ago, EPS was $0.64, so posted EPS means a improvement of 26.56%. Looking at turnover, figures moved up a 6.88% compared to $206.5M same quarter last year.

    Trex is hosting the earnings call on late next October. Forecasted earnings of %s a share for this quarter is $0.74. If you own or you are considering buying Trex shares, you must be aware that financial reporting day usually has a higher than usual volatility, and price can jump up or down with unsually low liquidity and not honouring your buy/stop-loss orders. It's always good to review company's website to confirm time and details about the earnings call and the earnings report.

    No ad for you