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Bernstein upgrades Five Below to Outperform, sees 22% upside on stronger outlook
['Jaiveer Shekhawat', 'Min Read']
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Investing.com -- Bernstein upgraded Five Below to Outperform from Market-Perform, arguing the discount retailer's recent operational improvements have strengthened its long-term growth outlook beyond the temporary boost from viral product trends.
The brokerage raised its price target to $250 from $247, implying roughly 22% upside from the stock's July 20 closing price of $204.14.
Analysts said investors have become overly focused on the potential slowdown after a first-quarter 23% comparable sales gain fueled by the "Squishy Dumpling" toy craze.
The firm also lifted its medium-term comparable sales forecast and expects annual store additions to remain robust, supporting a low-double-digit sales growth trajectory.
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