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Five Below
(NASDAQ:FIVE)
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Rating:72Outperform
Price Target:
$243.00
▼(-6.33% Downside)
Action:Reiterated
Date:10/15/26
The score is driven primarily by strong underlying profitability and cash generation alongside a very upbeat earnings call with raised guidance and meaningful margin/EPS expansion. These positives are tempered by weaker near-term technical momentum (negative MACD and sub-40 RSI) and some financial quality watch items, including slower TTM revenue growth, uneven cash conversion, and a still sizable absolute debt balance.
Positive Factors
Revenue and Store Expansion
Strong comparable-sales growth combined with rapid store expansion shows that Five Below is gaining customers while increasing its selling footprint. Broad traffic, transaction, geographic, and demographic growth support a durable growth engine, provided new locations continue delivering productive returns.
Negative Factors
Slower TTM Revenue Growth
The slower trailing revenue trend suggests that the business has experienced a more mature or uneven top-line trajectory despite the latest quarter’s acceleration. Sustaining strong growth will therefore depend on continued store productivity, customer acquisition, and successful merchandising innovation.
Read all positive and negative factors
Positive Factors
Negative Factors
Revenue and Store Expansion
Strong comparable-sales growth combined with rapid store expansion shows that Five Below is gaining customers while increasing its selling footprint. Broad traffic, transaction, geographic, and demographic growth support a durable growth engine, provided new locations continue delivering productive returns.
Read all positive factors
Five Below (FIVE) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$12.32B
Dividend YieldN/A
Average Volume (3M)1.06M
Price to Earnings (P/E)20.0
Beta (1Y)1.47
Revenue Growth25.56%
EPS Growth126.16%
CountryUS
Employees16,200
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)11.23
Shares Outstanding55,054,035
10 Day Avg. Volume977,940
30 Day Avg. Volume1,055,450
Financial Highlights & Ratios
PEG Ratio0.71
Price to Book (P/B)4.82
Price to Sales (P/S)2.22
P/FCF Ratio25.69
Enterprise Value/Market Cap1.05
Enterprise Value/Revenue2.43
Enterprise Value/Gross Profit6.32
Enterprise Value/Ebitda12.65
Forecast
1Y Price Target
$305.17Price Target Upside17.64% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering19
EPS Forecast (FY)10.25
Revenue Forecast (FY)$5.71B
Five Below Business Overview & Revenue Model
Company Description
Five Below, Inc. operates as a prominent specialty discount retailer primarily serving the United States market. The company's diverse inventory spans a wide array of personal accessories, from fashionable novelty socks, sunglasses, and jewelry to...
How the Company Makes Money
Five Below primarily makes money by selling merchandise to consumers through its company-operated retail stores, generating revenue at the point of sale. Its core revenue stream is retail product sales across multiple merchandising worlds (e.g., c...
Five Below Earnings Call Summary
Earnings Call Date:Sep 02, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Dec 02, 2026
Earnings Call Sentiment Positive
The call was strongly positive. Management reported exceptional second-quarter sales, traffic, profitability, new store productivity, cash generation, and customer engagement, raised full-year guidance, and described multiple growth initiatives as still being in the early innings. The primary challenges discussed were higher fuel costs, an unfavorable upcoming shrink comparison, an evolving tariff environment, moderated fourth-quarter comparable sales guidance, and developing omnichannel and personalization capabilities.Positive Updates
Strong Second-Quarter Sales and Comparable Growth
Net sales increased 23% versus last year to $1.3 billion. Comparable sales increased just over 14%, driven primarily by transaction growth, while unit growth was approximately 9%. This was the fifth straight quarter of double-digit comparable sales growth, with a 26.5% two-year stacked increase.
Negative Updates
Higher Fuel Costs Offset Margin Benefits
Meaningfully higher fuel costs were an offset to second-quarter gross margin expansion. For the third quarter, higher fuel costs on outbound transportation are expected to partially offset lower tariff costs and fixed-cost leverage.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Second-Quarter Sales and Comparable Growth
Net sales increased 23% versus last year to $1.3 billion. Comparable sales increased just over 14%, driven primarily by transaction growth, while unit growth was approximately 9%. This was the fifth straight quarter of double-digit comparable sales growth, with a 26.5% two-year stacked increase.
Read all positive updates
Company Guidance
For the third quarter, Five Below expects total sales in the range of $1.21 billion to $1.23 billion, or growth of about 18% at the midpoint, with comparable sales growth between 8% and 10%, approximately 40 net new stores, adjusted operating margin at the midpoint of about 6%, an increase of 160 basis points versus last year, adjusted gross margin at the midpoint up about 100 basis points, net interest income of approximately $8 million, an effective tax rate of approximately 25%, adjusted net income of $59 million at the midpoint, up 57% versus Q3 last year, and adjusted diluted earnings per share at the midpoint of $1.07 compared to $0.68; for the full year, sales are expected to be in the range of $5.63 billion to $5.71 billion, an increase of 19% at the midpoint, comparable sales growth between 10% and 12%, or 24% at the midpoint on a 2-year stack basis, adjusted operating margin of approximately 12.5% at the midpoint, up 250 basis points, adjusted net interest income of approximately $36 million, a full year effective tax rate of approximately 25%, adjusted diluted earnings per share of $10.07 at the midpoint on 55.5 million shares outstanding, growth of 51% versus 2025, and capital expenditures between $250 million and $260 million, or 4.5% of net sales at the midpoint, excluding the impact of tenant allowances, reflecting 150 net new store openings; the fourth quarter is positioned at about a 3% comp growth profile and an 18% 2-year stack, while the Five Beyond program requires probably in the range of $40,000 to $45,000 of CapEx per store.Five Below Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
67
Positive
Cash Flow
72
Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 5.31B | 4.76B | 3.88B | 3.56B | 3.08B | 2.85B |
| Gross Profit | 2.04B | 1.52B | 1.35B | 1.27B | 1.10B | 1.03B |
| EBITDA | 1.02B | 672.49M | 506.11M | 531.85M | 453.15M | 455.01M |
| Net Income | 619.18M | 358.64M | 253.61M | 301.11M | 261.53M | 278.81M |
Balance Sheet | ||||||
| Total Assets | 5.28B | 5.52B | 4.34B | 3.87B | 3.32B | 2.88B |
| Cash, Cash Equivalents and Short-Term Investments | 1.19B | 932.21M | 528.79M | 460.09M | 399.17M | 342.11M |
| Total Debt | 2.04B | 2.03B | 1.98B | 1.74B | 1.50B | 1.30B |
| Total Liabilities | 2.80B | 3.33B | 2.53B | 2.29B | 1.96B | 1.76B |
| Stockholders Equity | 2.48B | 2.19B | 1.81B | 1.58B | 1.36B | 1.12B |
Cash Flow | ||||||
| Free Cash Flow | 599.25M | 411.69M | 106.65M | 164.57M | 62.97M | 39.74M |
| Operating Cash Flow | 803.48M | 586.43M | 430.65M | 499.62M | 314.93M | 327.91M |
| Investing Cash Flow | -723.63M | -186.18M | -232.94M | -556.34M | -3.94M | -465.60M |
| Financing Cash Flow | -81.51M | -8.27M | -45.74M | -95.86M | -43.63M | -66.13M |
Five Below Technical Analysis
Positive
259.41
Price Trends
233.59
Negative
217.11
Positive
216.72
Positive
Market Momentum
-2.35
Negative
50.75
Neutral
88.43
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For FIVE, the sentiment is Positive. The current price of 259.41 is above the 20-day moving average (MA) of 218.84, above the 50-day MA of 233.59, and above the 200-day MA of 216.72, indicating a neutral trend. The MACD of -2.35 indicates Negative momentum. The RSI at 50.75 is Neutral, neither overbought nor oversold. The STOCH value of 88.43 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FIVE.
Five Below Risk Analysis
Five Below disclosed 33 risk factors in its most recent earnings report. Five Below reported the most risks in the "Ability to Sell" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Five Below Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $6.16B | 3.96 | 24.62% | 4.92% | 2.38% | 64.31% | |
72 Outperform | $12.32B | 19.96 | 27.73% | ― | 25.56% | 126.16% | |
69 Neutral | $13.35B | 13.21 | 15.72% | 13.87% | -7.71% | 145.76% | |
62 Neutral | $4.12B | 5.45 | -61.76% | 3.92% | -2.18% | 14.77% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $3.10B | 16.29 | 11.79% | 6.75% | 30.43% | -44.33% | |
57 Neutral | $1.54B | 61.75 | 5.75% | ― | 10.03% | -24.86% |
* Consumer Cyclical Sector Average
FIVE
Five Below
224.10
67.01
42.66%
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Five Below Corporate Events
Business Operations and StrategyPrivate Placements and Financing
Five Below Expands Revolving Credit Facility and Maturity
Positive
Oct 14, 2026
On October 14, 2026, Five Below, Inc. entered into a Third Amendment to its existing credit agreement, extending the maturity of its senior secured asset-based revolving credit facility from September 16, 2027 to October 14, 2031. The amendment wa...
Business Operations and StrategyExecutive/Board Changes
Five Below Adds Former Ulta CFO to Board
Positive
Sep 23, 2026
On September 21, 2026, Five Below, Inc. expanded its Board of Directors from nine to ten members and appointed former Ulta Beauty chief financial officer Scott Settersten as an independent director and member of the Audit Committee. Settersten rec...
Business Operations and StrategyStock BuybackFinancial Disclosures
Five Below Unveils $600 Million Share Repurchase Plan
Positive
Sep 2, 2026
Five Below reported strong financial results for the second quarter ended August 1, 2026, with net sales up 22.9% to $1.26 billion and comparable sales rising 14.1%, driven by both robust same-store performance and continued expansion to 2,022 loc...
Business Operations and StrategyRegulatory Filings and Compliance
Five Below Reports Limited Cybersecurity Incident, No Impact
Negative
Jul 22, 2026
Five Below, Inc. is a U.S. specialty value retailer that targets primarily teen and pre-teen customers with a broad assortment of low-price merchandise. The company operates chain stores offering trend-right products, including toys, accessories, ...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.