Back to top

Bear of the Day: Five Below (FIVE)

Read MoreHide Full Article

Five Below (FIVE - Free Report) is a specialty value chain retailer that provides a wide range of premium quality and trendy merchandise. The company primarily targets teenagers or pre-teen shoppers for its products.

Analysts have taken a bearish stance on the company’s earnings outlook, landing it into a Zacks Rank #5 (Strong Sell).

Zacks Investment Research
Image Source: Zacks Investment Research

In addition, the company is in the Zacks Retail – Miscellaneous industry, which is currently ranked in the bottom 20% of all Zacks industries.

Let’s take a closer look at the company.

 

Five Below

Recent quarterly results that have fallen short of expectations have caused FIVE shares to suffer, seeing post-earnings plunges following back-to-back releases. Concerning its latest print, the company fell short of the Zacks Consensus EPS estimate by 3%, with sales of $811 million also falling short of expectations.

Earnings fell 11% year over year, whereas sales climbed 12%. Comparable store sales declined 2.3% from the same period last year.

Zacks Investment Research
Image Source: Zacks Investment Research

The company provided soft guidance for its current fiscal year following the results, expecting an approximate 3% – 5% decrease in comparable store sales year-over-year. Analysts have adjusted their revenue expectations accordingly as well, with the $3.8 billion expected down 8% over the last year.

Zacks Investment Research
Image Source: Zacks Investment Research

Nonetheless, the company could soon enjoy a turnaround thanks to a recent CEO transition. It was recently announced that Joel Anderson (CEO) would be stepping down from his role to pursue other interests. Former CEO Thomas Vellios is intermittently leading the charge while the company continues its search for a permanent CEO.

 

Bottom Line

Negative earnings estimate revisions, resulting from soft quarterly results, paint a challenging picture for the company’s shares in the near term.

Five Below (FIVE - Free Report) is a Zacks Rank #5 (Strong Sell), indicating that analysts have taken a bearish stance on the company’s earnings outlook.

For those seeking strong stocks, a great idea would be to focus on stocks carrying a Zacks Rank #1 (Strong Buy) or a Zacks Rank #2 (Buy) – these stocks sport a notably stronger earnings outlook paired with the potential to deliver explosive gains in the near term.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Five Below, Inc. (FIVE) - free report >>

Published in