Trex Co. (TREX) Surged on Strong Results in Q1

Wasatch Global Investors, an asset management company, released its “Wasatch U.S. Select Strategy” first-quarter 2024 investor letter. A copy of the letter can be downloaded here. During the first quarter, the strategy gained but underperformed the Russell 3000 Growth Index benchmark, which was up 11.23%. Holdings in information technology (IT) and financials sectors detracted from the relative performance of the strategy, on the other hand, holdings in healthcare and consumer-discretionary sectors outperformed and contributed to the performance of the strategy in the quarter. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.

Wasatch U.S. Select Strategy highlighted stocks like Trex Company, Inc. (NYSE:TREX), in the first quarter 2024 investor letter. Trex Company, Inc. (NYSE:TREX) manufactures and distributes composite decking, railing, and outdoor living products and accessories. The one-month return of Trex Company, Inc. (NYSE:TREX) was -4.44%, and its shares gained 43.27% of their value over the last 52 weeks. On June 17, 2024, Trex Company, Inc. (NYSE:TREX) stock closed at $83.71 per share with a market capitalization of $9.099 billion.

Wasatch U.S. Select Strategy stated the following regarding Trex Company, Inc. (NYSE:TREX) in its first quarter 2024 investor letter:

"Another stock that contributed to performance was Trex Company, Inc. (NYSE:TREX). The U.S. company manufactures high-performance composite (non-wood) decking and accessories. The stock has continued to appreciate after the company released strong operating results in February. After recent gains, we’ve trimmed the position. However, we continue to see upside for the stock, and we believe the company will continue taking market share in composite decking and from traditional suppliers of wood products, which have shorter lifespans and require extra upkeep compared to composites."

A home exterior with a deck and railing crafted with products from the company.

Trex Company, Inc. (NYSE:TREX) is not on our list of 31 Most Popular Stocks Among Hedge Funds. As per our database, 37 hedge fund portfolios held Trex Company, Inc. (NYSE:TREX) at the end of the first quarter which was 32 in the previous quarter. Trex Company, Inc. (NYSE:TREX had an exceptionally strong first quarter. The company reported $374 million in net revenues in the quarter, up 57% year over year. While we acknowledge the potential of Trex Company, Inc. (NYSE:TREX)  as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

In another article, we discussed Trex Company, Inc. (NYSE:TREX) and shared Conestoga Capital Advisors' views on the company. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.