Five Below Tops Fiscal Q4 Expectations

Core Insights - Five Below exceeded analysts' expectations for both adjusted EPS and revenue in fiscal Q4 2024, reporting adjusted EPS of $3.48 against an estimate of$3.38 and revenue of $1.39 billion compared to an estimate of$1.38 billion [1] Financial Performance - Adjusted EPS for fiscal Q4 2024 was $3.48, down 4.7$3.65 in fiscal Q4 2023 [2] - Revenue reached $1.39 billion, a 4.0$1.34 billion in fiscal Q4 2023 [2] - Net income was $187.5 million, a decrease of 7.3$202.2 million in the previous year [2] - Operating income fell by 8.1% to $246.8 million compared to$268.4 million in fiscal Q4 2023 [2] Business Strategy - Five Below targets the tween and teen demographic, focusing on low-cost products and expanding its physical footprint [3] - The company opened 22 net new stores in fiscal Q4 2024, contributing to a total of 1,771 locations by the end of the fiscal year [4] - Management's strategic efforts include enhancing operational efficiency, inventory optimization, and reducing shrinkage to protect margins [6] Market Conditions - The fiscal Q4 2024 had 13 weeks compared to 14 weeks in fiscal Q4 2023, resulting in 7% fewer shopping days and contributing to declines in several metrics [5] - Comparable sales decreased by 3.0%, influenced by rising materials costs and SG&A expenses [5] Future Outlook - For fiscal 2025, Five Below projects net sales between $4.21 billion and$4.33 billion, with comparable sales expected to be flat to up 3% [7] - Diluted EPS is forecasted to be between $3.90 and$4.52, with adjusted EPS expected in the range of $4.10 to$4.72 [7] - The company plans to open approximately 150 new stores, indicating cautious optimism amid competitive pressures [7]