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Takeaways
- Five Below shares rise Friday after the retailer said it expects to turn in better-than-anticipated results for the current quarter.
- Investors and analysts are interested in whether discount retailers such as Five Below benefit from changing trade policies and economic uncertainty.
- Five Below also announced that director Mike Devine will likely succeed founder Tom Vellois in the role of chair.
Five Below stock increased Friday after the retailer stated that its stores are performing better than expected.
Five Below (FIVE), a chain known for toys and other inexpensive merchandise, will likely report about $967 million in sales for the current quarter—about 4.5% above the upper end of its prior guidance, the company said Friday. Five Below expects its first-quarter comparable sales to increase 6.7% year-over-year, not the 2% expected previously. Five Below’s first fiscal quarter ends on Saturday.
Analysts and investors are trying their best to predict whether consumers who are facing a dimmer economic outlook due to tariffs will turn more to discount retailers. Walmart (WMT), whose business with higher-income consumers has increased, while discount chains have seen shoppers trade down, will release its earnings on May 15th.
Five Below, a company with 1,800 stores, is expected to release its final quarter figures in early June. The company expects to elevate Mike Devine, director, to chair in June. Founder Tom Vellios will remain in the advisory role until 2025.
Five Below has also expanded faster than expected. According to the press release, the company believes that it will have opened 55 locations, not 50, by the end of the quarter.
Five Below shares rose 8% recently, though they have still lost more that 40% of their worth in the last year.
