Five Below Generate Stunning First Quarter Results; Pop Stock 6% after hours

Specialized discount retailer Five Below, Inc. (FIVE) had a burst quarter with profits and revenue exceeding street expectations due to high consumer demand. Stocks rose 3% at the start of trading on Friday.

Earnings for the quarter were $ 0.88 per share, beating analysts’ estimates of $ 0.65 per share. The company reported a loss of $ 0.91 per share during the prior year period.

Net sales were $ 597.8 million, up 197.6% year-over-year, and topped Street’s estimate of $ 551.14 million.

Comparable sales increased 162% year-on-year. At the end of the quarter, the company operated 1,087 stores in 39 states, including 67 net new stores. (See Five Below Stock Analysis on TipRanks)

Joel Anderson, President and CEO of the Company, said, “We are on track to open 170 to 180 new stores this year and bring our unique Five Below experience to more new customers. With the flexibility inherent in our eight worlds, our unique merchandising approach, and our focus on innovation, we believe we remain in a strong position to continue to grow Five Below and generate sustainable, long-term value. for all stakeholders. “

For the fiscal second quarter, the company expects net sales and earnings to be between $ 640 million and $ 660 million and between $ 1.01 and $ 1.13 per share, respectively. The Street estimates revenues of $ 584.3 million and earnings of $ 0.71 per share.

Following the results of the first quarter, the analyst of Berenberg Bank Brian McNamara reiterated a hold note on the stock and said: “Estimates will rise on the implied performance of the first half, but there remains considerable uncertainty as to how the cycle of difficult competitions in the second half will play out as the external tailwinds will subside. FIVE continues to not offer full year forecasts for a reason, in our opinion. “

The analyst assigned a price target of $ 162 for the share, which implies a potential downside of 11.9%.

The stock has a moderate buy consensus rating based on 11 buys and 4 holds. The average analyst price target of $ 228.47 implies an upside potential of 24% over current levels. Stocks have gained 68.1% in the past year.

Five Below gets an 8 out of 10 from TipRanks Smart score rating system, indicating that the stock has high potential to exceed market expectations.

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