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On Monday, Truist Securities revised its outlook on Five Below stock (NASDAQ: NASDAQ:FIVE), increasing the price target to $112 from the previous target of $81. The firm maintains a Hold rating on the stock. Currently trading at $116.57, Five Below has shown strong momentum with an 8.67% return in the past week. According to InvestingPro data, 16 analysts have recently revised their earnings estimates upward for the upcoming period.
The adjustment follows the company’s efforts to mitigate the impact of tariffs, resulting in stronger-than-expected sales in the first half of the year. Truist Securities analysts noted that their previous estimates were lowered due to concerns over tariffs but have now been adjusted upwards due to the company’s successful mitigation strategies. The company’s financial health is rated as GOOD by InvestingPro, with a comfortable current ratio of 1.79 indicating strong short-term liquidity.
The analysts highlighted that Five Below’s sales trends in the first and second quarters have surpassed expectations. They also mentioned that if tariffs continue to have minimal impact, the company could experience further growth, although risks remain regarding future tariff changes and potential negative elasticity in the market.
Despite the positive sales trends, Truist Securities has chosen to maintain its Hold rating on Five Below. The firm cites potential risks in the latter half of the year as a factor in their decision.
Five Below stock is currently being watched closely by investors as the company navigates the evolving tariff landscape and its implications on future sales performance.
In other recent news, Five Below has raised its first-quarter guidance for fiscal 2025, anticipating net sales of approximately $967 million, surpassing the earlier forecast of $905 million to $925 million. The company expects to open 55 new stores in the quarter, five more than initially planned, and projects a 6.7% increase in comparable store sales, exceeding the previous guidance of flat to 2% growth. Additionally, diluted income per common share is estimated to be between $0.69 and $0.71, with adjusted diluted income per share between $0.82 and $0.84, both higher than earlier projections. Citi raised its price target for Five Below to $121 from $80, while maintaining a Neutral rating, following the company’s strong first-quarter performance. UBS has also maintained a Buy rating with a price target of $110, emphasizing the company’s ability to manage tariff pressures and maintain sales momentum. Loop Capital increased its price target to $90 from $85, keeping a Hold rating, citing the positive impact of new CEO Winnie Park’s strategic initiatives. Barclays (LON:BARC) reiterated an Equalweight rating with a $93 price target, noting improved performance and potential benefits from competitor struggles but expressing caution regarding tariff impacts. Five Below also announced a leadership transition, with co-founder Tom Vellios stepping down as Executive Chair and moving to an advisory role, while Mike Devine is expected to become the non-executive Chair of the Board.
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