Trex Company Inc (TREX)
Trex Company, Inc. manufactures and distributes wood-plastic composite products and related accessories primarily for residential deck and railing applications in the United States. The company is headquartered in Winchester, Virginia.
Stock Price Trends
Stock price trends estimated using linear regression.
Key facts
- The primary trend is increasing.
- The growth rate of the primary trend is 56.05% per annum.
- TREX price at the close of November 19, 2024 was $67.43 and was lower than the bottom border of the primary price channel by $25.91 (27.76%). This indicates a possible reversal in the primary trend direction.
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 49.44% per annum.
- TREX price at the close of November 19, 2024 was inside the secondary price channel.
- The direction of the secondary trend is opposite to the direction of the primary trend. This indicates a possible reversal in the direction of the primary trend.
Linear Regression Model
Model equation:
Yi = α + β × Xi + εi
Top border of price channel:
Exp(Yi) = Exp(a + b × Xi + 2 × s)
Bottom border of price channel:
Exp(Yi) = Exp(a + b × Xi – 2 × s)
where:
i - observation number
Yi - natural logarithm of TREX price
Xi - time index, 1 day interval
σ - standard deviation of εi
a - estimator of α
b - estimator of β
s - estimator of σ
Exp() - calculates the exponent of e
Primary Trend
Start date: August 17, 2022
End date: June 20, 2024
a = 2.5066
b = 0.0012
s = 0.0983
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × 0.0012) – 1
= 56.05%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0983) – 1
= 48.16%
August 17, 2022 calculations
Top border of price channel:
Exp(Y689)
= Exp(a + b × X689 + 2 × s)
= Exp(a + b × 1,001 + 2 × s)
= Exp(2.5066 + 0.0012 × 1,001 + 2 × 0.0983)
= Exp(3.9236)
= $50.58
Bottom border of price channel:
Exp(Y689)
= Exp(a + b × X689 – 2 × s)
= Exp(a + b × 1,001 – 2 × s)
= Exp(2.5066 + 0.0012 × 1,001 – 2 × 0.0983)
= Exp(3.5305)
= $34.14
June 20, 2024 calculations
Top border of price channel:
Exp(Y1,151)
= Exp(a + b × X1,151 + 2 × s)
= Exp(a + b × 1,674 + 2 × s)
= Exp(2.5066 + 0.0012 × 1,674 + 2 × 0.0983)
= Exp(4.7441)
= $114.90
Bottom border of price channel:
Exp(Y1,151)
= Exp(a + b × X1,151 – 2 × s)
= Exp(a + b × 1,674 – 2 × s)
= Exp(2.5066 + 0.0012 × 1,674 – 2 × 0.0983)
= Exp(4.3510)
= $77.55
Description
- The primary trend is increasing.
- The growth rate of the primary trend is 56.05% per annum.
- TREX price at the close of November 19, 2024 was $67.43 and was lower than the bottom border of the primary price channel by $25.91 (27.76%). This indicates a possible reversal in the primary trend direction.
Secondary Trend
Start date: February 7, 2024
End date: October 28, 2024
a = 7.4987
b = -0.0019
s = 0.0677
Annual growth rate:
Exp(365 × b) – 1
= Exp(365 × -0.0019) – 1
= -49.44%
Price channel spread:
Exp(4 × s) – 1
= Exp(4 × 0.0677) – 1
= 31.10%
February 7, 2024 calculations
Top border of price channel:
Exp(Y1,059)
= Exp(a + b × X1,059 + 2 × s)
= Exp(a + b × 1,540 + 2 × s)
= Exp(7.4987 + -0.0019 × 1,540 + 2 × 0.0677)
= Exp(4.7565)
= $116.34
Bottom border of price channel:
Exp(Y1,059)
= Exp(a + b × X1,059 – 2 × s)
= Exp(a + b × 1,540 – 2 × s)
= Exp(7.4987 + -0.0019 × 1,540 – 2 × 0.0677)
= Exp(4.4857)
= $88.74
October 28, 2024 calculations
Top border of price channel:
Exp(Y1,241)
= Exp(a + b × X1,241 + 2 × s)
= Exp(a + b × 1,804 + 2 × s)
= Exp(7.4987 + -0.0019 × 1,804 + 2 × 0.0677)
= Exp(4.2632)
= $71.04
Bottom border of price channel:
Exp(Y1,241)
= Exp(a + b × X1,241 – 2 × s)
= Exp(a + b × 1,804 – 2 × s)
= Exp(7.4987 + -0.0019 × 1,804 – 2 × 0.0677)
= Exp(3.9924)
= $54.19
Description
- The secondary trend is decreasing.
- The decline rate of the secondary trend is 49.44% per annum.
- TREX price at the close of November 19, 2024 was inside the secondary price channel.