2023-06-22 08:33:33 ET
Jefferies reiterated a Buy rating on Five Below ( NASDAQ: FIVE ) on Thursday after meeting with management at the firm's Nantucket Consumer Conference.
Analyst Randal Konik said Five Below ( FIVE ) believes the U.S. consumer continues to feel pressure due to ongoing macro headwinds, inflation, the dwindling savings, elevated interest rates, and the cessation of the student loan moratorium. However, the retailer pointed to low unemployment numbers and higher wages as supporting sales levels. Looking ahead, Five Below ( FIVE ) is focusing on expanding the store base via recent real estate opportunities that have arisen. The chain is also looking to strengthen its assortment through value and customer demand.
Jefferies stayed bullish on Five Below ( FIVE ) due to the value-oriented offering, nimble and scaling business model, ample real estate growth opportunity, and the upside potential offered by the Five Beyond concept. "We see a path to FIVE's LT store-count target of 3,500 units, which we think may be conservative." noted Konok. Looking ahead, the inclusion of higher-price-point products in the FIVE assortment is expected to yield many benefits. The discounter is called a compelling long-term growth story.
Shares of Five Below ( FIVE ) gained 1.13% in premarket trading to $196.68 vs. the 52-week trading range of $109.49 to $220.19.
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Five Below is called a compelling long-term growth story by Jefferies