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Category: Stock Market and Five Below
Date: 19 March 2020 Stock Price: $53.59 We take a look at the 4th quarter earnings release of their 2019 fiscal year of Five Below a value retailer offering trend-right, high-quality products loved by tweens, teens and beyond.
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About Five Below
Five Below is a leading high-growth value retailer offering trend-right, high-quality products loved by tweens, teens and beyond. We know life is way better when you’re free to “let go & have fun” in an amazing experience filled with unlimited possibilities. With most items priced $1-$5, and some extreme value items priced up to just $10, we make it easy to say YES! to the newest, coolest stuff across 8 awesome Five Below worlds: Style, Room, Play, Create, Party, Candy, New & Now and Ten Below Tech. Founded in 2002 and headquartered in Philadelphia, Pennsylvania, Five Below today has 900 stores and counting in 36 states
Overview of Five Below's 4th quarter 2019 earnings report
The data below refers to the latest quarter unless specified otherwise:
- Net sales $687.130 million (up from $602.684 million from the same quarter of the previous year)
- Net sales increased by 14.01% over the last 12 months
- Cost of sales: $398.002 million (up from $358.679 million for the same quarter of the previous year)
- Cost of sales increased by 10.9% over the last 12 months
- Net income: $110.374 million (up from $89.262 million for the same quarter of the previous year)
- Diluted earnings per share: $1.97 (up from $1.59 for the same quarter of the previous year)
- PE ratio of Five Below: 27.2
- Diluted weighted-average shares outstanding: 56.006 million (down from 56.228 million for the same quarter of the previous year)
- Cash and cash equivalents: $202.490 million
- Cash and cash equivalents per share: $3.62
- Cash and cash equivalents makes up 6.87% of Five Below's market capital
- Cash and cash equivalents makes up 10.3% of Five Below's total assets
- Merchandise inventories: $324.028 million
- Merchandise inventories makes up 16,5% of Five Below's total assets.
- Stockholders equity in Five Below: $759.778 million
- Stockholders equity per share in Five Below: $13.56
- Five Below is trading at 3.95 times its stockholders equity per share which is within the expected range of between 2 and 4 times that most firm tend to trade at
- To put this in perspective he S&P 500 trades at a price to book value of 3.34. Read more about the S&P 500 here
Five Below's management commentary on their 4th quarter 2019 earnings and fiscal guidance
Joel Anderson, President and CEO of Five Below, stated, “Our fourth quarter results were in line with the revised expectations announced in conjunction with our holiday sales release. With six new store openings in the fourth quarter, we were very pleased to complete our planned 150 new stores, and achieve fourth quarter earnings growth of nearly 24%.”
Mr. Anderson continued, “Fiscal 2019 marked our fourteenth consecutive year of positive comps. I am very pleased with our teams’ execution and accomplishments in 2019. We had a very productive year as we mitigated tariffs, opened a record number of new stores and remodels, successfully tested Ten Below concepts, hired key senior executives, upgraded IT systems, and began a multi-year build out of our distribution network. In addition, we made our first financial investments outside of Five Below. We continue to build on our foundation and innovate across the organization, focusing on three key strategic priorities: experience, product and supply chain.”
Mr. Anderson continued, “Fiscal 2019 marked our fourteenth consecutive year of positive comps. I am very pleased with our teams’ execution and accomplishments in 2019. We had a very productive year as we mitigated tariffs, opened a record number of new stores and remodels, successfully tested Ten Below concepts, hired key senior executives, upgraded IT systems, and began a multi-year build out of our distribution network. In addition, we made our first financial investments outside of Five Below. We continue to build on our foundation and innovate across the organization, focusing on three key strategic priorities: experience, product and supply chain.”
“With the rapidly evolving COVID-19 situation, the health and safety of our associates and customers is our top priority, and we are taking the necessary steps to address the current environment across our stores, distribution centers and WowTown. As we announced earlier today, all of our stores will be temporarily closed beginning Thursday evening through March 31st. We will be paying our associates through this period. Given the uncertainty related to COVID-19, we are not providing guidance for the first quarter or fiscal 2020 at this time. If not for COVID-19, we would have expected fiscal 2020 to be in line with our 20/20 through 2020 goals,” concluded Mr. Anderson.
Fiscal 2020:
Given the uncertainty related to COVID-19, the Company will not be providing guidance for the first quarter or fiscal 2020.
Fiscal 2020:
Given the uncertainty related to COVID-19, the Company will not be providing guidance for the first quarter or fiscal 2020.
Five Below (NASDAQ:FIVE) stock price history
The image below, obtained from Google shows the stock price history of Five Below over the last 5 years. And its been a very volatile but overall a good time for stockholders of Five Below. 5 years ago the stock trading around $31.90 and its currently trading at $53.59. That's a healthy return of 67.90% over the last 5 years being provided by Five Below to stockowners.
The stock is Five Below is trading at a lot closer to its 52 week low of $48 and is far away from its 52 week high of $148.22, which is a clear indication that short term sentiment and momentum of Five Below is overwhelmingly negative, as is the case with most stocks listed considering the massive market sell off triggered by the impact of the Coronavirus.
The stock is Five Below is trading at a lot closer to its 52 week low of $48 and is far away from its 52 week high of $148.22, which is a clear indication that short term sentiment and momentum of Five Below is overwhelmingly negative, as is the case with most stocks listed considering the massive market sell off triggered by the impact of the Coronavirus.
Recent coverage of Five Below
The extract below touches on the latest results from Five Below as obtained from TheStreet.com.
Just one month ago, I revealed five reasons why I bought shares of Five Below (NASDAQ:FIVE). At the time, I was riding high, as I enjoyed a quick 20% pop in the stock price. But since then, things have gotten volatile on Wall Street. Really volatile.
The S&P 500 is down nearly 27% over the last month, and Five Below is down over 38% over the same timeframe. It's also down about 51% from 52-week highs set last April. I hate seeing my investments go down just as much as anyone else. But here's why I'm holding my Five Below stock through this financial storm.
The headline issues don't really apply to Five Below. There are two major headline issues driving stock prices lower. The first is the rapid spread of COVID-19, the disease which is caused by the coronavirus. That spread and the world's reaction to it is disrupting major industries such as travel, dining, and manufacturing. The second is the rapid decline in oil prices, as Saudi Arabia and Russia engage in a price war. Neither issue directly affects Five Below, at least not yet.
Read the full article here.
Just one month ago, I revealed five reasons why I bought shares of Five Below (NASDAQ:FIVE). At the time, I was riding high, as I enjoyed a quick 20% pop in the stock price. But since then, things have gotten volatile on Wall Street. Really volatile.
The S&P 500 is down nearly 27% over the last month, and Five Below is down over 38% over the same timeframe. It's also down about 51% from 52-week highs set last April. I hate seeing my investments go down just as much as anyone else. But here's why I'm holding my Five Below stock through this financial storm.
The headline issues don't really apply to Five Below. There are two major headline issues driving stock prices lower. The first is the rapid spread of COVID-19, the disease which is caused by the coronavirus. That spread and the world's reaction to it is disrupting major industries such as travel, dining, and manufacturing. The second is the rapid decline in oil prices, as Saudi Arabia and Russia engage in a price war. Neither issue directly affects Five Below, at least not yet.
Read the full article here.
Five Below (NASDAQ: FIVE) latest stock valuation
So based on Five Below's latest earnings report what are their stock currently worth? Based on Five Below's current earnings report and the updated fiscal guidance provided we have a target (full value) price in the stock at $59.90 (down significantly from our 3rd quarter 2019 earnings report valuation of Five Below. Largely due to expected impact of Coronavirus) So we believe at its current price Five Below's stock is undervalued.
We usually recommend that fundamental long term or value investors look to enter a stock at least 10% below our target (full value) price, which in this case is $59.90. We would therefore suggest looking to enter into the stock of Five Below's at around $53.90 or below.
We expect the stock of Five Below to kick up current levels to levels closer to our target price/ full value price in coming weeks and months as the Coronavirus fears subsides.
We usually recommend that fundamental long term or value investors look to enter a stock at least 10% below our target (full value) price, which in this case is $59.90. We would therefore suggest looking to enter into the stock of Five Below's at around $53.90 or below.
We expect the stock of Five Below to kick up current levels to levels closer to our target price/ full value price in coming weeks and months as the Coronavirus fears subsides.
Next earnings release of Five Below
It is expected that Five Below will release their 1st quarter 2020 earnings report in late June 2020