Connect with us
  • tg

Stock Markets

Five Below stock upgraded to Buy on better-than-expected results

letizo News

Published

on

On Thursday, Craig-Hallum upgraded shares of Five Below (NASDAQ:) from Hold to Buy, while reducing the price target to $102 from $108. The decision followed the company’s release of full second-quarter results and second-half 2024 guidance, which were received more positively than expected.

The upgrade was motivated by a number of factors, including sustained customer engagement as evidenced by positive store traffic and improving same-store sales (SSS) in the past month. All stores remaining profitable was highlighted as a testament to the strength of the business model. The analyst also cited the ease of SSS comparisons in the fiscal year 2025 as a potential catalyst for accelerating comparable sales.

Additionally, the analyst noted improvements in shrink-related issues and a planned slowdown in store growth, which could lead to same-store sales trends turning around and potential savings in selling, general, and administrative expenses (SG&A). The firm expressed confidence in the company’s ability to address previous challenges by simplifying operations and returning to its foundational focus on value and product novelty, while also reducing the number of stock-keeping units (SKUs) offered.

The revised price target of $102 implies approximately 30% upside from the closing price on August 28, 2024. The analyst concluded with a strong outlook on the stock’s potential, suggesting that Five Below is more likely to see its share price double to over $150 than to drop to $60, indicating an asymmetric risk/reward profile.

In other recent news, Five Below’s second-quarter earnings per share fell 36% to $0.54, matching expectations, and revenue came in at $830.1 million, slightly above analyst estimates of $821.91 million. However, comparable store sales decreased by 5.7%, a decline less severe than the anticipated 6.6% drop. Truist Securities has cut its price target for Five Below to $87, maintaining a hold rating due to concerns about the retailer’s upcoming months and issues with its merchandising strategy.

Meanwhile, Telsey Advisory Group lowered its price target to $102 from $120, citing operational challenges but maintaining an Outperform rating. Guggenheim maintained a Buy rating with a price target of $125, highlighting the company’s strategic plans, merchandising team, and potential for a rebound.

In response to these developments, Five Below has begun an in-depth analysis to address internal issues related to merchandising, pricing, and operations. The company aims to make substantial progress by spring or summer of 2025 while refocusing on delivering a value-leading assortment to its core pre-teen and teen customer base.

InvestingPro Insights

Following the upgrade from Craig-Hallum, current metrics from InvestingPro show that Five Below (NASDAQ:FIVE) has a market capitalization of $4.35 billion and a P/E ratio of 15.52, which is considered high relative to its near-term earnings growth. Despite the recent price decline, with the stock falling significantly over the past year, analysts remain optimistic about the company’s profitability, predicting profitability for this year. Additionally, the company’s liquid assets are reported to exceed short-term obligations, suggesting a strong liquidity position.

InvestingPro data highlights that Five Below has experienced a 15.24% revenue growth over the last twelve months as of Q1 2025, which aligns with the analyst’s positive outlook on the company’s ability to drive sales. However, the stock has taken a substantial hit over the last six months, with a price total return of -60.66%. Despite this, the company’s gross profit margin stands at a healthy 35.74%, indicating efficiency in managing its cost of goods sold.

For investors seeking to delve deeper into the company’s performance and potential, there are additional InvestingPro Tips available at InvestingPro’s dedicated page for Five Below. These tips may provide further insights into the company’s valuation, financial health, and market sentiment.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Stock Markets

Oil heads for weekly gains on colder weather, Chinese policy support

letizo News

Published

on

By Arathy Somasekhar

HOUSTON (Reuters) -Oil prices edged higher on Friday and were on track for weekly gains as cold weather in Europe and the U.S. as well as additional economic stimulus flagged by China helped push prices in the previous session to their highest in more than two months.

futures were up 69 cents, or 0.9%, at $76.62 a barrel by 12:49 p.m. ET (1749 GMT) after settling on Thursday at the highest level since Oct. 25. U.S. West Texas Intermediate crude gained $1.11, or 1.5%, to $74.24.

Brent was on track for a 3.3% weekly gain, while WTI was set for a 5% increase.

Signs of Chinese economic fragility heightened expectations of policy measures to boost growth in the world’s top oil importer.

“China just is unceasing at this point in terms of their announcements about trying to stoke economic activity, and the market’s taking note of that,” said John Kilduff, partner at Again Capital in New York.

Worries about Chinese demand were a factor in bearish demand assumptions last year, he added.

China announced a couple of new measures to boost growth this week with a surprise move to raise wages for government workers and the announcement of a sharp increase in funding from ultra-long treasury bonds.

The additional funding is to be used to spur business investment and consumer-boosting initiatives.

Oil is likely to have gained some price support from expected increased demand for after forecasts for colder weather in some regions.

“Oil demand is likely benefiting from cold temperatures across Europe and the U.S.,” said UBS analyst Giovanni Staunovo.

Also supporting prices, stockpiles dropped by 1.2 million barrels to 415.6 million barrels last week, EIA data showed.

Meanwhile U.S. gasoline and distillate inventories jumped as refineries ramped up output, though fuel demand hit a two-year low.

© Reuters. FILE PHOTO: A view of an oil pumpjack in a farmer’s field near Kindersley, Saskatchewan, Canada September 5, 2024.  REUTERS/Todd Korol/File photo

Holding back prices however, the dollar was on track for its best week in about two months, even as it dipped on Friday, on expectations that the U.S. economy will continue to outperform its peers globally this year and that U.S. interest rates will stay relatively higher.

Higher rates increase borrowing costs, which can cut economic growth and demand for oil.

Continue Reading

Stock Markets

QNB Corp director Kenneth Brown buys shares for $3,968

letizo News

Published

on

Following this purchase, Brown holds a total of 150,714 shares in QNB Corp. The company trades at a P/E ratio of 12.6 and has maintained dividend payments for 28 consecutive years. InvestingPro subscribers can access 6 additional key insights about QNBC’s valuation and growth prospects. The company trades at a P/E ratio of 12.6 and has maintained dividend payments for 28 consecutive years. InvestingPro subscribers can access 6 additional key insights about QNBC’s valuation and growth prospects. Following this purchase, Brown holds a total of 150,714 shares in QNB Corp.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Continue Reading

Stock Markets

US data center electricity and water use to increase significantly by 2028: report

letizo News

Published

on

Investing.com — U.S. data centers are expected to significantly increase their electricity and water usage by 2028, driven by the rising adoption of AI technology, according to a U.S. Department of Energy report.

The report forecasts data center electricity demand to rise by 13-27% annually, reaching 325-580 terawatt-hours (TWh), or 6.7-12% of total U.S. demand, by 2028.

This marks a sharp increase from 176 TWh in 2023, with AI servers accounting for much of the growth. demand from AI servers alone is expected to grow 4-8 times, surpassing conventional servers by 2028.

Water usage, primarily for cooling, is projected to increase even faster, by 17-33% annually, reaching 145-275 billion liters by 2028. The study highlights a shift towards water-cooled chillers to accommodate the higher energy density of AI-driven data centers.

The DOE study, conducted by the Lawrence Berkeley National Laboratory, underscores the rapid transformation in data center infrastructure, with substantial implications for energy and resource planning in the U.S.

Continue Reading

Trending

©2021-2024 Letizo All Rights Reserved