Five Below (FIVE) AI Stock Analysis

• Market Cap: $6.16B
• Dividend Yield: N/A
• Average Volume (3M): 2.57M
• Price to Earnings (P/E): 23.7
• Beta (1Y): 1.39
• Revenue Growth: 8.91%
• EPS Growth: -15.31%
• Country: US
• Employees: 7,300
• Sector: Consumer Cyclical
• Sector Strength: 72
• Industry: Specialty Retail
• EPS (TTM): 3.48
• Shares Outstanding: 55,055,965
• 10 Day Avg. Volume: 2,228,210
• 30 Day Avg. Volume: 2,572,628
• PEG Ratio: -14.38
• Price to Book (P/B): 10.37
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 176.03
• Enterprise Value/Market Cap: 3.31
• Enterprise Value/Revenue: 1.36
• Enterprise Value/Gross Profit: 15.98
• Enterprise Value/Ebitda: 10.08
• 1Y Price Target: $95.38
• Price Target Upside: -13.31% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 19

• Rating: 74 Outperform
• Price Target: ―

Five Below's stock score reflects a strong financial position with robust revenue growth and no debt. While technical indicators show positive momentum, the stock is approaching overbought levels. Valuation is fair, but not exceptional, and earnings call details highlight both growth opportunities and challenges, particularly related to tariffs and comparable sales. Recent corporate events further enhance the outlook with a positive financial adjustment and strategic expansion.

Positive Factors

Competitive Position

The declining competitive threat from Temu could be particularly meaningful as there is evidence of a value trade from higher-income consumers.

Earnings

Five Below provided updated guidance for its first quarter, where comps are now expected to grow by 6.7%, well above consensus of 1.1%.

Store Expansion

FIVE completed the opening of 55 new stores, representing growth of 13.8%.

Negative Factors

Margin Headwinds

Tariff headwinds are detracting ~100 bps of margin and putting FIVE down a narrow path balancing price increases with value-oriented messaging, with the impact wrapping into FY26E.

Sourcing Risk

Sourcing exposure to China remains key risk.

Tariff Risk

There is significant tariff risk with 60% of product historically coming from China.

Five Below Business Overview & Revenue Model

Company Description

Five Below, Inc. is a leading American discount retail chain that operates in the specialty retail sector, focusing on providing a wide range of products priced at $5 and below, with an increasing selection of items priced between $6 and $25. Founded in 2002 and headquartered in Philadelphia, Pennsylvania, the company caters primarily to tweens, teens, and pre-teens, offering an assortment of merchandise including toys, tech gadgets, beauty products, home decor, apparel, and seasonal items. Five Below is known for its vibrant store environment and fun shopping experience, which appeals to its youthful target demographic.

How the Company Makes Money

Five Below generates revenue primarily through the direct sale of merchandise in its physical retail stores across the United States. The company's revenue model is centered around its unique value proposition of offering high-quality, trend-forward products at affordable, fixed price points. This pricing strategy encourages impulse buying and attracts a wide customer base. Key revenue streams include sales from various product categories, such as leisure, fashion, home, and seasonal items. Five Below's growth strategy involves expanding its store footprint across the country, increasing brand awareness, and enhancing product offerings. Additionally, the company leverages its supply chain efficiencies and strong relationships with vendors to maintain low costs and competitive pricing, which are crucial factors contributing to its profitability.

Five Below Financial Statement Overview

Summary

Five Below's financial performance is strong, with significant revenue growth and a robust balance sheet showing increased equity and no debt. However, potential volatility in operating efficiency and cash flow management, along with inconsistent free cash flow growth, require attention.

Income Statement

Five Below has demonstrated strong revenue growth over recent years, with a notable increase in total revenue from $1.96 billion in 2021 to $3.56 billion in 2024. The company also maintains healthy gross profit and net profit margins, suggesting operational efficiency and profitability. However, fluctuations in EBIT and EBITDA margins indicate potential volatility in operating efficiency.

Balance Sheet

The company's balance sheet is robust, with a significant increase in stockholders' equity from $0.76 billion in 2020 to $577.85 billion in 2025, indicating strong investor confidence. The absence of total debt in 2025 reflects a conservative financial strategy, reducing leverage-related risks. Equity ratio improvement enhances financial stability, though historical debt-to-equity ratios suggest past leverage.

Cash Flow

Operating cash flows have been positive, supporting the company's ability to fund operations internally. However, inconsistent free cash flow growth and variations in free cash flow to net income ratios highlight challenges in capital expenditure management and cash generation efficiency. The recent lack of reported operating and free cash flow data requires attention.

Breakdown
Mar 2025	Mar 2024	Mar 2023	Mar 2022	Mar 2021
Income Statement		Total Revenue
3.88B	3.56B	3.08B	2.85B	1.96B
	Gross Profit
1.35B	1.27B	1.10B	1.03B	652.33M
	EBIT
323.82M	385.57M	345.04M	379.88M	154.80M
	EBITDA
506.11M	516.32M	450.66M	464.71M	224.15M
	Net Income Common Stockholders
253.61M	301.11M	261.53M	278.81M	123.36M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
528.79M	460.09M	399.17M	342.11M	409.71M
	Total Assets
4.34B	3.87B	3.32B	2.88B	2.31B
	Total Debt
1.98B	1.74B	1.50B	1.30B	1.11B
	Net Debt
1.65B	1.56B	1.16B	1.23B	841.55M
	Total Liabilities
2.53B	2.29B	1.96B	1.76B	1.43B
	Stockholders Equity
1.81B	1.58B	1.36B	1.12B	881.89M
Cash Flow		Free Cash Flow
106.65M	164.57M	62.97M	39.74M	165.78M
	Operating Cash Flow
430.65M	499.62M	314.93M	327.91M	365.97M
	Investing Cash Flow
-232.94M	-556.34M	-3.94M	-465.60M	-286.89M
	Financing Cash Flow
-45.74M	-95.86M	-43.63M	-66.13M	-12.78M

Five Below Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 110.03
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: 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 110.03 is above the 20-day moving average (MA) of 92.14, above the 50-day MA of 78.94, and above the 200-day MA of 87.91, indicating a bullish trend. The MACD of 9.85 indicates Negative momentum. The RSI at 74.67 is Negative, neither overbought nor oversold. The STOCH value of 85.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for FIVE.

Five Below Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BBW	80 Outperform	$549.63M	10.95	38.54%	2.02%	2.12%	3.78%
FIVE	74 Outperform	$6.16B	23.75	14.95%	―	8.91%	-15.31%
SBH	72 Outperform	$937.31M	4.93	29.74%	―	0.17%	20.26%
ASO	71 Outperform	$2.97B	7.80	21.14%	1.08%	-3.67%	-14.66%
ETSY	64 Neutral	$4.92B	33.03	-39.97%	―	2.18%	-32.87%
Sector *	62 Neutral	$6.88B	11.26	2.78%	3.93%	2.65%	-22.00%
AAP	52 Neutral	$2.04B	59.62	-23.77%	3.19%	-16.55%	-941.57%

Five Below Corporate Events

Five Below Raises Q1 2025 Financial Outlook

On April 28, 2025, Five Below announced that co-founder and Executive Chairman Thomas G. Vellios will not stand for re-election at the 2025 Annual Meeting, transitioning to an advisory role by the end of 2025. The company also raised its first quarter 2025 financial outlook, expecting net sales of approximately $967 million and the opening of 55 new stores, reflecting a strong performance under CEO Winnie Park’s leadership and a strategic focus on product, value, and store experience.