Five Below, Inc. FIVE has showcased a stellar performance during the holiday season, underscoring the exceptional ability to connect with consumers looking for affordable and trendy products. This high-growth value retailer posted an 8.7% increase in net sales for the quarter-to-date period from Nov. 3, 2024 through Jan. 4, 2025 (Holiday Period).

FIVE Holiday Sales Snapshot

Five Below generated net sales of $1.19 billion during the Holiday Period, up from $1.10 billion reported in the comparable nine-week period from Nov. 5, 2023 through Jan. 6, 2024. However, comparable sales for the Holiday Period dipped 3.2%, highlighting some softness in same-store performance despite overall revenue gains.

Management stated that holiday results came in line with expectations. Efforts to enhance product offerings, deliver value and improve the in-store experience are underway. The company remains optimistic about making further advancements in 2025.

Based on the holiday performance and January forecasts, Five Below now expects fourth-quarter sales to land in the upper half of its previously provided guidance. The company had earlier guided net sales between $1.35 billion and $1.38 billion, with a comparable sales decline of approximately 3% to 5%. Management reiterated adjusted earnings outlook of $3.23 to $3.41 per share.

For fiscal 2024, Five Below maintains its guidance for net sales of $3.84 billion to $3.87 billion. It expects a 3% decrease in comparable sales. Adjusted earnings are forecast between $4.78 and $4.96 per share, aligning with expectations set during the third-quarter earnings call.

Five Below's holiday sales performance and fiscal guidance underscore its resilience and strategic focus. As it enters 2025, the company’s initiatives to enhance its product mix and customer experience are expected to play a crucial role in driving sustainable growth.

Image Source: Zacks Investment Research

Should You Invest in FIVE Stock?

Five Below is refocusing its product strategy with a renewed commitment to offering high-quality, trend-right products at unbeatable prices, targeting its core teen and pre-teen demographic. The company is optimizing merchandising by improving category performance, rationalizing SKU count and enhancing product selection with a focus on value. 

The introduction of Five Beyond, offering higher-end products at extreme value, has resonated well with customers. Its store expansion efforts position it for continued market share growth. Five Below’s strong cash position, zero debt and inventory management strategies indicate solid financial health.

Shares of this Zacks Rank #1 (Strong Buy) company have advanced 6.8% compared with the industry’s rise of 2.2%.

Other Stocks Looking Hot

Abercrombie & Fitch ANF, an omnichannel specialty retailer of apparel and accessories for men, women and kids, sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year revenues and earnings calls for growth of 15% and 69.3%, respectively, from the year-ago reported figures. Abercrombie & Fitch has a trailing four-quarter earnings surprise of 14.8%, on average.

The Gap GAP, the largest specialty apparel company in the United States and a house of iconic brands, including Old Navy, Gap, Banana Republic and Athleta, sports a Zacks Rank #1. 

The Zacks Consensus Estimate for Gap’s current financial-year revenues and earnings suggests growth of 0.8% and 41.3%, respectively, from the year-ago reported figures. GAP has a trailing four-quarter earnings surprise of 101.2%, on average.

Urban Outfitters URBN, a leading lifestyle products and services company, operates a portfolio of global consumer brands, including the Anthropologie, Free People, FP Movement, Urban Outfitters and Nuuly. The company sports a Zacks Rank #1.

The Zacks Consensus Estimate for Urban Outfitters’ current financial-year revenues and earnings suggests growth of 6.6% and 19.7%, respectively, from the year-ago reported figures. URBN has a trailing four-quarter earnings surprise of 22.8%, on average.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report

Urban Outfitters, Inc. (URBN) : Free Stock Analysis Report

The Gap, Inc. (GAP) : Free Stock Analysis Report

Five Below, Inc. (FIVE) : Free Stock Analysis Report

To read this article on Zacks.com click here.

Zacks Investment Research