Shares of Five Below (FIVE, Financial) have witnessed a significant drop of 26.13% today, following the announcement of "reciprocal tariffs" on all US imports, including a minimum rate of 10%.
Five Below Inc (FIVE, Financial), a specialty value retailer geared towards the tween and teen demographic, currently trades at a price of $60.20. The company's market capitalization stands at $3.31 billion, suggesting a light weight in the market. Despite the recent decline, Five Below maintains a PE ratio of 13.12, which is close to its 10-year low, potentially indicating an undervalued position. Notably, the GF Score ranks the stock with a strong value with a GF Value of $201.66, suggesting it is significantly undervalued.
The stock's price is near a 52-week low, indicating market concerns that may overshadow its valuation metrics. The company has shown consistent revenue and earnings growth, with revenue growth at a rate of 9.8% over the past year and a remarkable 17.7% over five years. Its predictability rating of 5 further emphasizes its stability in revenue growth.
In terms of financial health, Five Below has a Beneish M-Score of -2.82, implying it is unlikely to be a manipulator of financial statements. However, the Altman Z-score of 2.63 suggests the company is experiencing some financial stress, although not at immediate risk of bankruptcy. The operating margin has been in a declining trend over the last five years, averaging a decrease of 2.7% per year.
Investors should also note insider activity: within the past three months, there have been two insider selling transactions involving a total of 10,710 shares, reflecting potential concerns from within. While the stock is currently facing headwinds, its valuation metrics and historical growth performance provide a mixed but intriguing case for potential investment.
