Five Below Stock Slides After Mixed Quarterly Report

Analysts and options traders are targeting the stock

Deputy Editor
Sep 2, 2021 at 10:34 AM
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Five Below Inc (NASDAQ:FIVE) stock is careening lower today, following a mixed second-quarter report. The department store name reported earnings of $1.15 per share, four cents above estimates, alongside lower-than-expected revenue. Due to Covid-19 uncertainties, the company didn't issue a full-year forecast, however, it did announce strong expectations for the third quarter. At last check, FIVE was down 9.9% to trade at $194.56. 

The brokerage bunch has been quick to chime in with price-target adjustments. J.P. Morgan Securities raised its price objective to $255 from $250, while three other analysts cut their price targets. However, one of those three, Craig-Hallum, continues to view FIVE as "best-in-class" and maintains a "buy" rating -- noting the retailer's "saavy negotiations" on freight costs. 

Of the 16 analysts in coverage, 10 carry a "buy" or better rating on the security, with six a "hold." Meanwhile, it would take over four days for shorts to buy back their bearish bets, at FIVE's average pace of trading, with 3.9% of the stock's available float sold short. 

The options pits are, unsurprisingly, exploding with activity this morning. So far, 4,072 calls and 6,063 puts have crossed the tape, which is 16 times the intraday average. The weekly 9/3 190-strike put is the most popular, with plenty of traders betting on more downside for the stock by the contract's expiration tomorrow. 

On the charts, the 160-day moving average appears to be catching today's pullback, as the equity hits its lowest level since early August. Five Below stock has been on its way lower since its Aug. 25 all-time high of $237.86, but is still up 11% year-to-date. It's also worth noting that amid this negative price action, the equity has landed on the Short Sale Restricted (SSR) list. 

 

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