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On Thursday, Mizuho (NYSE:MFG) analysts raised the price target for Five Below stock (NASDAQ: NASDAQ:FIVE) to $115 from $100, while maintaining a Neutral rating. The adjustment follows the company’s full first-quarter results, which slightly exceeded the previous month’s positive preannouncement. The results showed an incremental 40 basis points increase in transaction-led comparable sales and an upside to earnings. According to InvestingPro data, the stock has shown strong momentum with a 15.5% return year-to-date, though current RSI readings suggest the stock is in overbought territory.
The analysts noted that the comparable sales growth is broad-based and not limited to a small selection of key products. This growth is trending in the double-digit percentage range quarter-to-date, driven by improved conversion rates. Collectibles have been identified as a significant long-term opportunity for the retailer, a point that has been emphasized in previous analyses. InvestingPro data reveals the company maintains healthy financials with a current ratio of 1.79 and operates with moderate debt levels. For deeper insights into Five Below’s financial health and growth potential, including 8 more exclusive ProTips, consider exploring the comprehensive Pro Research Report available on InvestingPro.
Five Below is also reducing its reliance on China, shifting approximately 7.5% to 10% of its sourcing elsewhere. This strategic move is part of the company’s efforts to mitigate risks associated with tariffs and other macroeconomic factors.
Despite the positive momentum, the sales expectations for the second half of the year remain unchanged. However, the company sees potential for upside to its current guidance, depending on macroeconomic conditions and consumer reactions to tariffs.
The management of Five Below indicated that the impact of price increases across its stores has been better than initially expected, leading to an improvement in unit sales. This development prompted Mizuho analysts to adjust their estimates higher, resulting in the new price target of $115.
In other recent news, Five Below reported strong first-quarter earnings, with earnings per share (EPS) of $0.86, surpassing various analysts’ estimates. The company also achieved a comparable sales increase of 7.1%, exceeding expectations. Following these results, several analyst firms adjusted their price targets for Five Below. Jefferies raised its price target to $155, maintaining a Buy rating, while Citi increased its target to $135 with a Neutral rating. Telsey also raised its price target to $128, citing improved guidance for the second quarter. Despite these positive developments, BofA Securities maintained an Underperform rating, raising its price target to $93, reflecting concerns about potential challenges in the latter half of 2025. The company announced a change in its executive team, with CFO Kristy Chipman stepping down for personal reasons. Analysts from KeyBanc noted positive results from recent merchandising initiatives but maintained a neutral outlook due to potential risks in the second half of the year. These recent developments highlight Five Below’s ongoing efforts to navigate market challenges while capitalizing on growth opportunities.
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