Why Trex Shares Plunged in March
Trex (NYSE: TREX) reported year-end earnings after markets closed on the last day of February, so it was March by the time investors weighed in on the results. Shares of the composite decking company fell sharply in the early days of the month and failed to recover, finishing off 28.9% for the month, according to data provided by S&P Global Market Intelligence.
There was nothing wrong with Trex's quarter. The company actually beat expectations both in terms of earnings per share and revenue. But the results did little to get investors excited about what is to come. Trex in recent years has benefited from a number of strong tailwinds, including a robust housing market and a pandemic-induced frenzy to remodel and upgrade existing houses. With interest rates potentially on the rise, which historically has eaten into housing, and companies plotting a post-pandemic return to the office, it appears those tailwinds could be fading.
Image source: Trex.
Source Fool.com
