Preview: What to expect from Five Below earnings on Wednesday

TPhiladelphia, Pa.-Based discount retailer Five Below is expected to report third-quarter earnings of $ 0.29 per share, down nearly 20% year-over-year from $ 0.36 per share in the same period a year ago. .

This week’s results for the popular discount store retailer that sells products that cost up to $ 5 are also expected to be good for investors watching the stock. Sales are expected to increase by more than 15% to $ 562 million. Opening new stores and attracting new customers to existing locations will help the company achieve this growth.

The company expects net sales for the third quarter of fiscal 2021 to be between $ 550 and $ 565 million, compared to $ 476.6 million last year. Comparable sales are expected to increase by a few numbers. The company expects to earn between 23 and 30 cents a share in the third quarter, up from 36 cents a year ago, according to ZACKS Research.

Five Below shares fell about 2.5% to $ 204.74 on Friday. The stock has risen by more than 17% so far this year.

Five below the stock price prediction

Eleven analysts who have offered stock quotes for Five Below in the past three months have forecast a 12-month average price of $ 234.80 with a high forecast of $ 300.00 and a low forecast of $ 184.00.

The target average price represents a change of 14.68% from the last price of $ 204.74. Of those 11 analysts, seven rated “Buy”, four “Hold” while none rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price of $ 230 with a high of $ 300 in a bullish scenario and $ 120 in a worst-case scenario. The company assigned a rating of “overweight” to the shares of the discount retailer.

Several other analysts have also updated their stock market outlook. Deutsche Bank raised the target price to $ 271 from $ 265. CFRA reduced the price target from $ 220 to $ 210. Berenberg lowered the target price to $ 184 from $ 185.

Technical analysis suggests it’s good to buy as a 100-day moving average, and the 100-200-day MACD oscillator signals a strong buying opportunity.

Analyst comments

“FIVE’s profile among pure B&M retailers is almost unmatched (top / bottom teenage account growth, no debt). It is guided by a differentiated and defensible model focused on extreme value goods in various categories. FIVE is emerging from the COVID-19 pandemic as a fundamentally stronger and more relevant company, with the best growth characteristics, various company-specific initiatives in place and strong liquidity, ”noted Simeon Gutman, equity analyst. at Morgan Stanley.

“The valuation is below historical average due to unwarranted short-term supply chain / cost issues, which we believe are exaggerated. Growth of white space stores (> 50% remaining unit runway) and multi-year history of approximately 20% growth in square feet with productivity> 90%.

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This article originally appeared on FX Empire

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