Financial Survey: Trex (NYSE:TREX) versus Carrier Global (NYSE:CARR)

Carrier Global (NYSE:CARR) and Trex (NYSE:TREX) are both industrials companies, but which is the better investment? We will compare the two businesses based on the strength of their risk, valuation, institutional ownership, analyst recommendations, earnings, profitability and dividends.

Profitability

This table compares Carrier Global and Trex’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Carrier Global	5.52%	14.68%	5.51%
Trex	14.68%	18.03%	11.76%

Risk and Volatility

Carrier Global has a beta of 1.29, suggesting that its stock price is 29% more volatile than the S&P 500. Comparatively, Trex has a beta of 1.48, suggesting that its stock price is 48% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of recent ratings and price targets for Carrier Global and Trex, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Carrier Global	0	9	12	0	2.57
Trex	2	10	11	0	2.39

Carrier Global currently has a consensus target price of $72.27, suggesting a potential upside of 31.37%. Trex has a consensus target price of $49.90, suggesting a potential upside of 13.62%. Given Carrier Global’s stronger consensus rating and higher probable upside, equities analysts clearly believe Carrier Global is more favorable than Trex.

Earnings & Valuation

This table compares Carrier Global and Trex”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Carrier Global	$21.75 billion	2.09	$1.48 billion	$1.44	38.20
Trex	$1.17 billion	3.89	$190.41 million	$1.68	26.15

Carrier Global has higher revenue and earnings than Trex. Trex is trading at a lower price-to-earnings ratio than Carrier Global, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

91.0% of Carrier Global shares are held by institutional investors. Comparatively, 96.0% of Trex shares are held by institutional investors. 6.5% of Carrier Global shares are held by insiders. Comparatively, 0.9% of Trex shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

About Carrier Global

Carrier Global Corporation provides heating, ventilating, and air conditioning (HVAC), refrigeration, fire, security, and building automation technologies in the United States, Europe, the Asia Pacific, and internationally. It operates through three segments: HVAC, Refrigeration, and Fire & Security. The HVAC segment provides products, controls, services, and solutions to meet the heating, cooling, and ventilation needs of residential and commercial customers. Its products include air conditioners, heating systems, heat pumps, controls, and aftermarket components, as well as aftermarket repair and maintenance services and building automation solutions. The Refrigeration segment offers transport refrigeration and monitoring products and services, as well as digital solutions for trucks, trailers, shipping containers, intermodal applications, food retail, and warehouse cooling; and commercial refrigeration solutions, such as refrigerated cabinets, freezers, systems, and controls. The Fire & Security segment provides various residential, commercial, and industrial technologies, including fire, flame, gas, smoke, and carbon monoxide detection; portable fire extinguishers; fire suppression systems; intruder alarms; access control systems; video management systems; and electronic controls. This segment also offers fire and security service, such as audit, design, installation, and system integration, as well as aftermarket maintenance and repair and monitoring services. It offers its products under the Autronica, Det-Tronics, Edwards, Aritech, Fireye, GST, Kidde, LenelS2, Marioff, Onity, and Supra; Carrier, Toshiba, Automated Logic, Bryant, CIAT, Day & Night, Heil, NORESCO, and Riello; and Carrier Commercial Refrigeration, Carrier Transicold, and Sensitech brands. Carrier Global Corporation was incorporated in 2019 and is headquartered in Palm Beach Gardens, Florida.

About Trex

Trex Company, Inc. manufactures and distributes composite decking, railing, and outdoor living products and accessories for residential and commercial markets in the United States. It offers decking products and accessories under the names Trex Transcend, Trex Select, Trex Signature, Trex Transcend Lineage, and Trex Enhance for protection against fading, staining, mold, and scratching; Trex Hideaway, a hidden fastening system; and Trex DeckLighting, a LED dimmable deck lighting for use on posts, floors, and steps. The company also provides Trex Transcend Railing products that are used in Trex decking products and other decking materials; Trex Select Railing products for a simple clean finished look; Trex Enhance Railing system; Trex Signature aluminum railing for a contemporary look; and Trex Select T-Rail railing products. In addition, it offers Trex Seclusions, a fencing product that includes structural posts, bottom and top rails, pickets, and decorative post caps. Further, the company acts as a licensor in various licensing agreements with third parties to manufacture and sell products under the Trex name, including Trex Outdoor Furniture; Trex RainEscape, an above joist deck drainage system; Trex Pergola, a cellular PVC product; Trex Latticeworks outdoor lattice boards; Trex Cornhole boards; Diablo Trex Blade, a saw blade for wood-alternative composite decking; Trex SpiralStairs and structural steel posts; and Trex Outdoor Kitchens, cabinetry, and Storage products. It sells its products through wholesale distributors, retail lumber dealers, and Home Depot and Lowe’s stores. Trex Company, Inc. was founded in 1996 and is headquartered in Winchester, Virginia.