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TREX, Trex Company, Inc.

Building Products capital-intensive Capital build-out

Trex Company, Inc. is the world's largest manufacturer of composite decking and railing products, which are marketed under the brand name Trex and manufactured in the United States.

Helping homeowners design outdoor spaces that reflect their individual styles and budgets, coupled with Performance- Engineered products at various price points makes Trex the leading brand for homeowners seeking to invest in their outdoor living spaces.

Trex's ability to leverage strong brand awareness and a product offering with the advantages of sustainability, low-maintenance, and durability to help fuel conversion from wood decking and railing to Trex positions our Company well within the large and expanding Outdoor Living market.

Latest annual: FY2025 10-K

TREX · Trex Company, Inc.

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$1.2B

+2.0% YoY · 6% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $1.2B 5-yr avg $1.1B

Gross margin 39% 5-yr avg 40%

Operating margin 22.1% 5-yr avg 24.1%

ROIC 16% 5-yr avg 29%

Owner-earnings margin 28% 5-yr avg 20%

Free cash flow margin 19% 5-yr avg 7%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

Situation: Capital build-out. Capital spending has surged to 19% of sales, today's earnings are charged less depreciation than tomorrow's will be.
What moves the needle: Gross margin has run about 41% and operating margin about 25% through the cycle, a solid spread between what it charges and what the product costs to make. That margin has stayed fairly steady relative to where it runs (22%–28% over the years), so unit growth and cost discipline, not a moving line, are the lever. Capital spending runs about 13% of sales, well above depreciation, so the return earned on what it sinks into that plant weighs as much as the margin. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has run high across the record (median 37%, above 15% in 10 of 10 years), though buybacks and expensed R&D and brands shrink the capital base, so the figure overstates the underlying economics. The steadier read is owner earnings: roughly 18% of revenue reaches owners as cash, consistently. Whether these returns reflect real pricing power or an accounting artifact is the judgment the 10-K is for.

Every line is arithmetic on the company's filings, shown in full in the sections below.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$480M	$565M	$684M	$745M	$881M	$1.2B	$1.1B	$1.1B	$1.2B	$1.2B	$1.2B	RevenueRevenue
39%	43%	43%	41%	41%	38%	37%	41%	44%	39%	39%	Gross marginGross mgn
17%	18%	17%	16%	14%	12%	13%	16%	16%	17%	17%	SG&A / revenueSG&A/rev
1%	1%	1%	0%	0%	1%	0%	0%	0%	0%	0%	R&D / revenueR&D/rev
$104M	$142M	$177M	$188M	$234M	$275M	$247M	$275M	$322M	$258M	$260M	Operating incomeOp. inc.
21.7%	25.2%	25.8%	25.2%	26.5%	23.0%	22.3%	25.1%	28.0%	22.0%	22.1%	Operating marginOp. mgn
$68M	$95M	$135M	$145M	$176M	$209M	$185M	$204M	$238M	$190M	$191M	Net incomeNet inc.
34%	33%	24%	24%	25%	24%	25%	26%	26%	26%	26%	Effective tax rateTax rate
											Cash flow & returns
$85M	$102M	$138M	$156M	$187M	$258M	$216M	$389M	$144M	$358M	$394M	Operating cash flowOp. cash
$14M	$17M	$17M	$14M	$18M	$36M	$44M	$50M	$55M	$63M	$67M	DepreciationDeprec.
($2M)	($15M)	($19M)	($9M)	($13M)	$5M	($18M)	$125M	($162M)	$96M	$126M	Working capital & otherWC & other
$15M	$15M	$34M	$67M	$173M	$159M	$176M	$166M	$232M	$224M	$167M	CapexCapex
3.0%	2.7%	4.9%	9.0%	19.6%	13.3%	15.9%	15.2%	20.2%	19.0%	14.2%	Capex / revenueCapex/rev
$71M	$87M	$122M	$142M	$169M	$222M	$172M	$339M	$89M	$295M	$327M	Owner earningsOwner earn.
14.7%	15.4%	17.8%	19.1%	19.2%	18.6%	15.5%	31.0%	7.8%	25.1%	27.7%	Owner earnings marginOE mgn
$71M	$87M	$104M	$89M	$14M	$99M	$40M	$223M	($88M)	$135M	$226M	Free cash flowFCF
14.7%	15.4%	15.2%	12.0%	1.6%	8.2%	3.6%	20.4%	−7.7%	11.5%	19.2%	Free cash flow marginFCF mgn
$55M	$4M	$30M	$47M	$45M	$82M	$398M	$18M	$106M	$54M	—	BuybacksBuybacks
59%	48%	57%	48%	37%	36%	35%	28%	27%	18%	16%	ROICROIC
51%	41%	39%	32%	30%	29%	34%	28%	27%	18%	19%	Return on equityROE
51%	41%	39%	32%	30%	29%	34%	28%	27%	18%	19%	Retained to equityRetained/eq
											Balance sheet
$19M	$31M	$106M	$149M	$122M	$141M	$12M	$2M	$1M	$4M	$4M	Cash & investmentsCash+inv
$48M	$67M	$91M	$78M	$107M	$151M	$98M	$41M	$88M	$48M	$327M	ReceivablesReceiv.
$29M	$35M	$58M	$56M	$68M	$84M	$141M	$107M	$257M	$239M	$230M	InventoryInvent.
$11M	$10M	$31M	$15M	$39M	$25M	$20M	$24M	$61M	$35M	$66M	Accounts payablePayables
$66M	$91M	$118M	$119M	$136M	$210M	$219M	$124M	$284M	$252M	$491M	Operating working capitalOper. WC
$106M	$149M	$270M	$303M	$322M	$401M	$287M	$172M	$369M	$310M	$580M	Current assetsCur. assets
$51M	$63M	$93M	$79M	$106M	$89M	$291M	$91M	$342M	$251M	$566M	Current liabilitiesCur. liab.
2.1×	2.4×	2.9×	3.9×	3.0×	4.5×	1.0×	1.9×	1.1×	1.2×	1.0×	Current ratioCurr. ratio
$11M	$68M	$69M	$69M	$68M	$14M	—	—	$14M	$14M	$14M	GoodwillGoodwill
$221M	$326M	$465M	$592M	$770M	$920M	$934M	$933M	$1.4B	$1.5B	$1.7B	Total assetsAssets
92.4×	308.9×	—	—	—	—	—	—	—	—	430.9×	Interest coverageInt. cov.
$134M	$231M	$343M	$449M	$589M	$725M	$545M	$742M	$887M	$1.0B	$996M	Shareholders’ equityEquity
1.0%	0.9%	0.9%	0.9%	0.8%	0.7%	0.5%	0.9%	1.1%	0.8%	0.8%	Stock comp / revenueSBC/rev
											Per share
118M	118M	118M	117M	116M	116M	112M	109M	108M	107M	105M	Shares out (diluted)Shares
$4.05	$4.78	$5.79	$6.35	$7.58	$10.34	$9.89	$10.06	$10.63	$10.96	$11.20	Revenue / shareRev/sh
$0.57	$0.80	$1.14	$1.23	$1.51	$1.80	$1.65	$1.88	$2.20	$1.78	$1.82	EPS (diluted)EPS
$0.60	$0.73	$1.03	$1.21	$1.46	$1.92	$1.54	$3.12	$0.82	$2.76	$3.11	Owner earnings / shareOE/sh
$0.60	$0.73	$0.88	$0.76	$0.12	$0.85	$0.36	$2.05	$-0.82	$1.26	$2.15	Free cash flow / shareFCF/sh
$0.12	$0.13	$0.29	$0.57	$1.49	$1.38	$1.58	$1.53	$2.14	$2.09	$1.59	Cap. spending / shareCapex/sh
$1.13	$1.95	$2.90	$3.83	$5.06	$6.26	$4.87	$6.82	$8.19	$9.66	$9.47	Book value / shareBVPS

Share counts before 2018 are restated ×2 for a stock split, so per-share figures sit on one basis.

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	+11.7%/yr	+7.7%/yr
Owner earnings / share	+18.5%/yr	+13.6%/yr
EPS	+13.4%/yr	+3.3%/yr
Capital spending / share	+37.0%/yr	+7.0%/yr
Book value / share	+26.9%/yr	+13.8%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked. Share counts on the current split basis.

Share count

107Mpeak FY2016

ROIC

18%low FY2025

Gross margin

39%low FY2022

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

$295Mowner earningsvs.$190Mnet incomelow FY2016

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetained

Each year's operating cash, by what management did with it: the mix, and how it drifts.

FY2016FY2025

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business earned $295M of owner earnings, the operating cash left after the $63M it takes just to hold its position. It put $161M more into growth; free cash flow, after that spending, was $135M.

Reported net income$190M

Owner earnings$295M · 25% of revenue

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	$190M	$238M	$204M	$185M	$209M
Depreciation & amortizationnon-cash charge added back	+$63M	+$55M	+$50M	+$44M	+$36M
Stock-based compensationreal costnon-cash, but a real cost	+$9M	+$13M	+$10M	+$5M	+$8M
Working capital & othertiming of cash in and out, other non-cash items	+$96M	−$162M	+$125M	−$18M	+$5M
Cash from operations	$358M	$144M	$389M	$216M	$258M
Maintenance capital expenditurethe spending needed just to hold position and volume	−$63M	−$55M	−$50M	−$44M	−$36M
Owner earnings	$295M	$89M	$339M	$172M	$222M
Growth capital expenditurediscretionary; spent to get bigger, not to stand still	−$161M	−$178M	−$116M	−$132M	−$123M
Free cash flow	$135M	($88M)	$223M	$40M	$99M
Owner-earnings marginowner earnings ÷ revenue	25%	8%	31%	16%	19%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the maintenance capital it must spend to hold its position (here about $63M, roughly its depreciation, the rate its assets wear out). The other $161M of its capital spending is growth it chose, not upkeep it owed; charged only with the maintenance it must do, the business earns well more than the year's free cash flow shows. The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $9M), owner earnings is nearer $286M.

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? 559.6×

Comfortable

Operating income $258M ÷ interest expense $461K

What this means
Operating profit covers interest with the kind of margin Graham wanted for a defensive holding. Necessary, not sufficient, it says solvent, not cheap.
How heavy is the debt, net of cash? $83M · 0.3× operating profit

Modest net debt

Cash $4M − debt $86M

What this means
Netting $4M of cash and short-term investments against $86M of debt leaves $83M owed, about 0.3× a year's operating profit. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 119d

Long (60+ days)

DSO 15 + DIO 122 − DPO 18 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital 36%

Very high (≥25%) through the cycle

10-yr median, range 18%–59%; 17% latest = NOPAT $190M ÷ invested capital $1.1B

Industry peers: median 16%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran 17% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin 18%

High through the cycle

10-yr median margin, range 8%–31%; latest $295M = operating cash $358M − maintenance capex $63M

Industry peers: median 8%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's 25% of revenue this year, a 18% median across 10 years. It chose to put $161M more into growth, so free cash flow this year was $135M — the gap is investment, not weakness. Treating stock comp as the real expense it is (less $9M of SBC) leaves $286M.
Are earnings backed by cash? 1.88×

Cash-backed

Cash from ops $358M ÷ net income $190M

What this means
How much of reported profit showed up as operating cash. Above 1× is reassuring; well below suggests earnings lean on accruals. One year is noisy, growth and working-capital swings distort it, and this is operating cash, not free cash. Watch the multi-year trend.

How is the cash used?

Where do the earnings go? 18%

Reinvests most of it

Dividends + buybacks $54M ÷ Owner Earnings $295M

What this means
Of $295M Owner Earnings, $54M (18%) went back to shareholders, $0 dividends, $54M buybacks. Net of $9M stock comp, the real buyback was about $45M. Returning most of it is the mark of a mature business with little left to reinvest at a high return; reinvesting most could mean a long runway, or empire-building. The split doesn't say which; the return earned on it (see ROIC) does.
Investing or harvesting? 3.55×

Expanding

Capex $224M ÷ depreciation $63M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Near

Revenue ≥ $2B · $1.2B

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Miss

Current ratio ≥ 2× · 1.24×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Near

Debt ≤ working capital · $86M vs $60M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Pass

A profit every year (10-yr record) · no losses

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Pass

Earnings +33% over the record · +113%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $2.03/share (latest year $1.83), the averaged base the calculator's gate runs on, and book value is $9.95/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 10 of 10

What this means
Never lost money over the record, the earnings stability Graham insisted on.
Operating margin 24% → 25% (3-yr avg ends)

What this means
Through the cycle the operating margin held roughly steady — about 24% early, 25% lately, median 25%.
Owner earnings growth +10%/yr

What this means
Owner earnings grew about 10% a year over the record.
Worst year 2016 · 21.7% op. margin

What this means
Stayed profitable even in its hardest year, the resilience that survives recessions.
How management talks about it Owner’s terms

What this means
The record and the register agree: capital is compounding and the filing reasons in an owner’s terms — per-share value, return on capital, the long term — not a promoter’s.

Does AI threaten the moat?

Moderate contestability

AI is likely to reshape costs and some products here without clearly contesting or sparing the core moat; how the company itself frames it is the tell.

The question is whether a moat the record shows as durable outlasts a technology that lowers the cost of part of what the firm sells. The durability is read in the record above, the filing's own framing of AI beside it; the industry label decides nothing on its own.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$580M

Cash & short-term investments$4M
Receivables$327M
Inventory$230M
Other current assets$19M

Current liabilities$566M

Debt due within a year$92M
Accounts payable$66M
Other current liabilities$409M

Current ratio1.02×all current assets ÷ what's due · Graham looked for 2×

Quick ratio0.62×stricter: inventory excluded

Cash ratio0.01×strictest: cash alone against what's due

Working capital$14Mthe cushion left after near-term bills

Debt due this year vs. cash$92M due · $4M cash cash alone won't cover the maturities; it leans on refinancing or operating cash · both figures from the Mar 31, 2026 balance sheet

Revenue, latest quarter vs. a year ago+1.0%the freshest read on whether the business is still growing

Current ratio, recent quarters1.8× → 1.0×

Deeper floors

Tangible book value$964Mequity stripped of goodwill & intangibles

Net current asset value($154M)Graham's net-net: current assets less all liabilities

Debt incl. operating leases$236M$53M of it operating leases

From the company's latest filing.

How the cash was used, 2016–2025

Over the record, the business generated $2.0B of operating cash; how management split it reads as a reinvestor, most operating cash is plowed back into the business.

Reinvested$1.3B · 62%
Buybacks$840M · 41%

Returned to owners$840M
49% of the owner earnings the business produced over the span, $0 as dividends and $840M as buybacks.
Source of funding−$66M
Reinvestment and shareholder returns ran $66M beyond the operating cash the business generated, so the gap was financed off the balance sheet: cash and short-term investments drew down $14M.
Average price paid for buybacks—
Buybacks ran $840M over the span, but the filings don't tag the share count needed to deduce the average price paid.
Net change in share count−11.2%
The diluted count fell from 118M to 105M, so the buybacks outran the stock issued to staff.
Dividend record—
No dividend line was reported in the filing data over the span; the record here neither confirms nor rules out a payout.
Return on what it retained18%
Of the earnings it kept rather than paid out ($804M over the span), annual owner earnings (first three years vs last three) grew $148M, so each retained $1 added about 0.18 of yearly owner earnings. Buffett's test, run on owner earnings instead of market value.

Buybacks are gross of stock issued to staff; the share-count line above is the net of that, the figure that decides whether owners gained. The average price paid blends a year of purchases (and any accelerated repurchase), so it is close, not exact. The record of where the cash went and on what terms.

Acquisitions & goodwill

from the balance sheet & the 10-year cash-flow record

Goodwill grows only when a company acquires and falls only when it concedes it overpaid. The size of that bet, the cash put into buying rather than building, and how much has already been written off.

Goodwill & intangibles$32M2% of all assets; the premium carried on the balance sheet for businesses acquired

Against book equity1%goodwill is this share of book equity; the rest is the company’s own retained and paid-in capital

Cash spent acquiring$72Mover 10 years buying other businesses, against $1.3B of capital spent building

$54M written down across 1 year (2021): goodwill the company has already conceded it overpaid for, charged against earnings. That is roughly 76% of the cash it put into acquisitions over the span. A write-down costs no cash (the cash went out when the deal was signed), but it is management marking its own past judgment to market.

Goodwill, acquired intangibles and equity from the latest balance sheet; acquisition spend and write-downs summed across the 10-year record, from the company's own filings.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	Mr. Fairbanks	$4.1M	$7.7M	$222M
2022	Mr. Fairbanks	$3.3M	−$1.9M	$172M
2023	Mr. Fairbanks	$5.8M	$10.7M	$339M
2024	Mr. Fairbanks	$5.9M	$4.6M	$89M
2025	Mr. Fairbanks	$6.6M	$1.0M	$295M

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership<1%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
Stock-based compensation$9M
The slice of the business handed to employees in shares this year, 1% of revenue, equal to 4% of operating profit. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Trex Company, Inc. is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

1 of the 5 tests turned up something to look into; the other 4 came back clean.

Look hereDid receivables and inventory outpace sales?16% → 47% of sales
Receivables and inventory grew from $77M to $557M while revenue grew 146%: working capital is climbing faster than sales (16% of revenue then, 47% now). That can mean customers paying slower, stock building up, or revenue pulled forward. The filing's cash-flow and receivables notes say which.

And these came back clean

Is it less profitable than it was?
Did the share count rise anyway?
Did reported profit become cash?
Are "one-time" charges a yearly habit?

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

Peers, Building Products

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
UFPIUFP Industries	$6.3B	16%	6.2%	16%	6%
FBINFortune Brands	$4.5B	41%	13.1%	12%	9%
LPXLouisiana-Pacific Corporation	$2.7B	27%	18.3%	29%	11%
SKYChampion Homes Inc.	$2.7B	22%	8.2%	22%	8%
CVCOCavco Industries, Inc.	$2.2B	22%	9.1%	20%	9%
KOPKoppers Holdings Inc.	$1.9B	20%	8.0%	9%	4%
TREXTrex Company, Inc.	$1.2B	41%	25.1%	37%	18%
LEGHLegacy Housing Corporation	$117M	—	35.3%	12%	-2%
Group median	—	22%	11.1%	18%	9%

The price

What a price has to assume.

What the price implies

reverse-DCF

Type today's close and see the owner-earnings growth you'd have to believe to justify it, beside what Trex Company, Inc. has delivered.

Trex Company, Inc.’s latest year runs above its own through-cycle margin — the reported figure may flatter a peak. So the tool opens on the through-cycle base, Graham’s averaging cutting both ways; clear the toggle below to read the latest year exactly as reported.

Today’s price $

Through the cycle, Trex Company, Inc. earns about $213M on its 18.2% median owner-earnings margin. This year’s 25.1% margin runs above that; the reported figure may flatter a peak you'd be paying on. Normalize, below, values the price on that through-cycle figure rather than the latest year. It comes pre-checked here for that reason, the same rule that already normalizes a trough; clear it to price the year as filed.

Base Normalize · through-cycle ($213M) Net of stock comp (−$9M) Steady-state · maintenance capex ($331M)

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The assumptions Required return 9% Years of high growth 10 Terminal growth 2.5%

9.0% = the 4.55% 10-year Treasury (Jul 15, 2026) + 4.45 points of equity premium. The rate you require is yours to set.

Enter a price above to run it.

Implied by the price—

Owner-earnings growth · ’21→’25−1%/yr

Owner-earnings growth · ’16→’25−13%/yr

Owner-earnings yield—

P/E (3-yr earnings ’23–’25)—

P/B—

Graham’s price gate—

Graham capped the multiple at 15×; Buffett and Munger let that rule go: a wonderful business can deserve 50× if the thesis holds. The gate marks the bargain-hunter's floor.

Against a high-grade bond: Graham’s yardstick bond yield%

Prefilled with the 10-year Treasury (4.55%, as of Jul 15, 2026). Edit it for today’s exact figure, or a AAA corporate yield.

Graham measured a stock against the bond you could own instead, the heart of his margin of safety. Enter a price above to weigh the owner-earnings yield against this bond.

Free cash flow $226M on 104M shares outstanding, per the 10-Q cover, as of 2026-04-16; net debt $179M. The base opens on the through-cycle figure (the latest year sits above the record’s own median, and Graham’s averaging cuts both ways); clear Normalize to use the year as filed. Net of stock comp treats option pay as the expense it is. Capex ($167M) runs well above depreciation ($67M), so this is a build-out; Steady-state swaps total capex for maintenance (≈ depreciation), lifting the base to about $331M, the cash it would throw off if it stopped expanding. The dials set the multiple a growth belief justifies; the price, and every dollar on this page, is yours.

Weigh TREX against another business →

Cite: Owner Scorecard, "Trex Company, Inc. (TREX), the owner's record," https://ownerscorecard.com/c/TREX, data as of 2026-07-09.

Manual order: ← TREE its page in the Manual TRGP →

Industry order: ← TGLS the Building Products chapter TT →