Trex vs Meritage Homes

Trex vs Meritage Homes Corporation compares Trex Co. Inc. and Meritage Homes Corporation, outlining their business models, financial performance, and market context. The page presents neutral, accessible information to help readers understand differences and similarities between the two companies. Educational content, not financial advice.

Trex vs Meritage Homes Corporation compares Trex Co. Inc. and Meritage Homes Corporation, outlining their business models, financial performance, and market context. The page presents neutral, accessi...

About The Companies

Trex (TREX)

Trex Co. Inc. (TREX) is a leading manufacturer of composite decking and outdoor living products, known for using recycled materials to produce low-maintenance alternatives to wood. With a market cap around $5.50 billion, Trex benefits from trends in home improvement, outdoor living, and sustainability as homeowners favour durable, low-upkeep materials. Investors should note the business is tied to the housing and renovation cycles, so sales and margins can be sensitive to broader economic and interest-rate conditions. Competitive dynamics include traditional timber, other composite manufacturers and DIY market shifts. Strengths include brand recognition, licensing and distribution networks, and a sustainability angle, while risks cover raw‑material costs, weather-dependent installation seasons, and execution of capacity expansion. This summary is educational only and not personalised advice; investors should assess how Trex fits their risk profile, read regulatory filings, and consider market volatility. Past performance is not a reliable indicator of future results.

Meritage Homes (MTH)

Meritage Homes Corporation (MTH) is a US-listed homebuilder specialising in single-family detached houses, often targeting entry-level and move-up buyers across fast-growing Sun Belt markets. The company generates revenue from land acquisition, home construction and the sale of completed homes, with additional margin from design options and upgrades. Meritage has emphasised energy-efficient building standards and prescriptive cost management to try to protect margins, but its performance remains cyclical and sensitive to mortgage rates, labour and materials costs, and local land supply. With a market cap around $5.08bn, investors should weigh potential upside from housing demand recovery against risks from interest-rate moves, inventory and consumer affordability. This is general educational information, not personalised advice; values can rise or fall and past performance does not predict future returns.

Comparison Snapshot

Key Financial Metrics

TREX

Metric

MTH

$3.76B

Market Cap

$5.07B

24.23%

Potential Profit

13.49%

Hold

Analyst Rating

Buy

Which Baskets Do They Appear In?

U.S. Homebuilding Rebound

Recent data shows new home sales jumping 7.4% monthly, signaling a strong housing market revival. This collection features carefully selected homebuilders and suppliers positioned to benefit from increasing construction activity and rising home prices.

Published: June 30, 2025

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Which Baskets Do They Appear In?

U.S. Homebuilding Rebound

Recent data shows new home sales jumping 7.4% monthly, signaling a strong housing market revival. This collection features carefully selected homebuilders and suppliers positioned to benefit from increasing construction activity and rising home prices.

Published: June 30, 2025

Explore Basket

Investment Analysis

Trex

TREX

Pros

Trex maintains a leading market position in composite decking with strong brand recognition among consumers and professionals.
The company is forecast to grow revenues and earnings over the next two years despite recent setbacks.
Trex benefits from product innovation and a diverse portfolio, including decking, railing, and accessories.

Considerations

Recent financial results missed guidance, with Q3 sales down 5% from expectations and a 26% sequential decline.
Management has revised 2025 sales growth to flat, citing weaker demand and inventory reductions by channel partners.
Investor scrutiny has increased due to questions over the accuracy of prior disclosures about inventory management and growth prospects.

Meritage Homes

MTH

Pros

Meritage Homes operates in high-demand US housing markets with a diversified regional footprint across ten states.
The company maintains a strong balance sheet, with a current ratio of 12.7 and a quick ratio of 2.21.
Meritage Homes trades at a low valuation, with a price-to-earnings ratio below the sector average.

Considerations

Homebuilding is highly cyclical and sensitive to interest rates, which could pressure demand and margins.
The company's financial services segment is exposed to fluctuations in mortgage rates and lending activity.
Meritage Homes faces risks from land acquisition costs and construction delays, which can impact profitability.

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About The Companies

Comparison Snapshot

Which Baskets Do They Appear In?

U.S. Homebuilding Rebound

Which Baskets Do They Appear In?

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Investment Analysis

Trex

Pros

Considerations

Meritage Homes

Pros

Considerations

Why invest with Nemo?

Zero Commission

Trusted & Regulated

6% Interest on Cash

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Frequently asked questions

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Comparison Snapshot

Trex vs Meritage Homes

About The Companies

Comparison Snapshot

Which Baskets Do They Appear In?

U.S. Homebuilding Rebound

Which Baskets Do They Appear In?

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Investment Analysis

Trex

Pros

Considerations

Meritage Homes

Pros

Considerations

Why invest with Nemo?

Zero Commission

Trusted & Regulated

6% Interest on Cash

Discover More Comparisons

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Frequently asked questions

What does it mean when one stock has a leading market position but experiences recent setbacks?

How should I interpret a company’s forecast revisions in a stock comparison?

What is the role of a diversified product mix in evaluating Trex?

Why is a low valuation meaningful in a stock comparison?

How do cyclical factors affect the two stocks differently?

What is the significance of a strong balance sheet in this comparison?

How does market context influence the two companies’ prospects?

What risks do interest rates pose to Trex and Meritage Homes?

How should I read the pros and cons when comparing these stocks?

What is the educational takeaway from this Trex vs Meritage Homes comparison?

About The Companies

Comparison Snapshot