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Investing.com - Craig-Hallum raised its price target on Five Below (NASDAQ:FIVE) to $180.00 from $164.00 on Thursday, while maintaining a Buy rating following the retailer’s strong second-quarter performance. According to InvestingPro data, the stock has delivered an impressive 83% return over the past year, with 8 analysts recently revising their earnings estimates upward.
The discount retailer reported same-store sales growth exceeding 12% in Q2, with Craig-Hallum noting that the company’s third-quarter guidance exceeded market expectations as traffic momentum continued despite tougher year-over-year comparisons. The company’s revenue growth stands at 13.88%, supported by a healthy current ratio of 1.71, indicating strong operational efficiency. InvestingPro analysis shows the company is currently trading at Fair Value, with 12 additional exclusive insights available to subscribers.
The firm highlighted that Five Below’s comp growth was broad-based across categories, with licensed products serving as a key driver. The retailer’s pivot to social media marketing has helped it connect with its core customer base more effectively.
Craig-Hallum also pointed to notable changes in Five Below’s pricing strategy that have helped mitigate tariff impacts while simplifying operations. The expected tariff impact for Q3 was reduced, though Q4 impact projections remained unchanged, potentially creating room for significant upside to guidance.
The firm mentioned that inventory counts are ongoing and the company has not adjusted shrink accrual rates, which could serve as a significant catalyst for upside to second-half 2025 performance.
In other recent news, Five Below has reported impressive second-quarter results that have prompted several analyst firms to adjust their price targets for the company. The retailer’s comparable sales growth reached 12.4%, exceeding the projections of firms like Truist Securities, which had anticipated an 11.0% increase. Following these results, Truist Securities raised its price target for Five Below from $141 to $148, maintaining a Hold rating. UBS also increased its price target from $160 to $184, maintaining a Buy rating, and highlighted that the sales growth was largely driven by transaction volume and higher average ticket sizes. Jefferies followed suit, raising its target from $155 to $185, citing strong management execution. BofA Securities increased its price target from $93 to $110, despite maintaining an Underperform rating, noting that Five Below’s earnings per share of $0.81 surpassed both their estimate and the consensus. KeyBanc reiterated its Sector Weight rating, attributing the company’s success to strong merchandising and product innovation. These developments underscore the positive market response to Five Below’s recent financial performance.
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