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Five Below (FIVE) Soars 8.4%: Is Further Upside Left in the Stock?

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Five Below (FIVE - Free Report) shares soared 8.4% in the last trading session to close at $91.52. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 7.7% loss over the past four weeks.

Five Below’s growth is fueled by its aggressive store expansion and a strategic refocus on its core pre-teen and teen customer base. The success of its Five Beyond format alongside ongoing improvements in operational efficiency and inventory management, will drive sales growth, margin expansion, and overall profitability.

This discount retailer is expected to post quarterly earnings of $0.15 per share in its upcoming report, which represents a year-over-year change of -42.3%. Revenues are expected to be $795.56 million, up 8% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

For Five Below, the consensus EPS estimate for the quarter has remained unchanged over the last 30 days. And a stock's price usually doesn't keep moving higher in the absence of any trend in earnings estimate revisions. So, make sure to keep an eye on FIVE going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Five Below is a member of the Zacks Retail - Miscellaneous industry. One other stock in the same industry, Dick's Sporting Goods (DKS - Free Report) , finished the last trading session 2.5% higher at $199.98. DKS has returned -3.8% over the past month.

Dick's' consensus EPS estimate for the upcoming report has remained unchanged over the past month at $2.68. Compared to the company's year-ago EPS, this represents a change of -6%. Dick's currently boasts a Zacks Rank of #3 (Hold).


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