Trex (TREX) Looks Likely To Recover In 2H19, PT to $79 at DA Davidson

DA Davidson analyst Kurt Yinger lowered the price target on Trex (NYSE: TREX) to $79.00 (from $80.00) while maintaining a Buy rating after the company reported better than expected revenue growth in 1Q19, though missed on earnings due to elevated startup costs/manufacturing inefficiencies associated with the company's new Enhance decking products.

The analyst stated "Equipment failures at the NV production facility also weighed, and have left Trex unable to satisfy otherwise strong demand for its decking products, resulting in weaker 2Q19 guidance. Given our view that these issues will be behind the company going into 2H19, and that 1H19 revenue growth doesn't capture the underlying demand Trex is experiencing, our 2020 forecasts are little changed".

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