The retailer lowered its full-year net sales forecast
The shares of Five Below Inc (NASDAQ:FIVE) are down 7.9% to trade at $124.71 this morning, following the retailer's first-quarter earnings report. Five Below posted profits of 59 cents per share, which just barely topped analysts' estimates, on revenue that missed forecasts. Additionally, the company slashed its full-year net sales forecast to the range of $3.04 billion to $3.12 billion, well below what was expected by analysts.
The brokerage bunch is taking notice, with 11 firms already slashing their price targets. The lowest comes from Evercore ISI to $145 from $155, while J.P. Morgan Securities cut its price objective all the way to $153 from $207. With a 12-month consensus price target of $184.85 -- a 36.6% premium to last night's close -- and all 13 analysts in coverage considering FIVE a "buy" or better, heading into today, there's reason to believe even more bear notes could be on the horizon for the discount retail stock.
An unwinding of optimism among options traders could also weigh on the equity. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), FIVE sports a 50-day call/put ratio of 2.70, which sits higher than 79% of readings from the past year. In other words, options traders have been picking up calls at a quicker-than-usual clip.
Five Below stock is down 34.6% in 2022, and 28.5% in the past 12 months. Though the equity was able to stage a sharp bounce off its May 24 annual low of $110.83, the 30-day moving average put a lid on these gains, sending FIVE back below a recent bull gap on the charts.