Five Below (FIVE) PT Raised to $135 at Guggenheim As Comps Appear to be Stabilizing

Guggenheim analyst John Heinbockel raised the price target on Five Below (NASDAQ: FIVE) to $135.00 (from $120.00) after Revenue modestly beat expectations. Stronger initial productivity of 80% versus 60%, offset a slightly weaker comp. Comps in “open” stores rose a solid 6% with e-commerce expanding 4x off of a very low base.

The analyst reiterated a Buy rating, stating "comp momentum seems to be stabilizing in the mid-SD range, a solid performance for a non-consumable or home retailer. We believe that comps rose about 5% in July, and management noted a 6% gain 3Q to-date". "Comps are benefiting from the sale of more essential products, like hand sanitizers and room-related merchandise as the buyers pivoted to them earlier in COVID. We assume a moderation from here to 4% to exit the 3Q and to 3% in the 4Q".

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