What Happened?
Shares of discount retailer Five Below (NASDAQ: FIVE) fell 2.7% in the afternoon session after investor concerns grew over weakening consumer spending and a broader market downturn.
The slide in the share price happened amid a general market decline, as benchmark equity indices also fell. More specific data pointed to a slowdown in consumer activity. A report from Barclays recorded a steep fall in retail card spending, with discount retailers seeing a particularly sharp 7.6% drop. Adding to the worries, a University of Michigan survey showed consumer sentiment fell by about 6% in November. This drop was driven by lower expectations for business conditions and a deterioration in personal finances.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Five Below? Access our full analysis report here.
What Is The Market Telling Us
Five Below’s shares are very volatile and have had 26 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 15 days ago when the stock gained 2.8% on the news that JPMorgan upgraded the stock to 'Overweight' from 'Neutral' and raised its price target. The bank increased its price target to $186 from a previous $154. In the upgrade, the firm noted it saw the company's multi-year earnings growth hitting at least low double-digits. JPMorgan believed this growth would be supported by the continued opening of new stores and a steady increase in sales at existing locations. The bank also pointed to Five Below's recent efforts to improve its products, marketing, and the overall in-store experience as factors that should support consistent sales growth.
Five Below is up 50% since the beginning of the year, and at $148.60 per share, it is trading close to its 52-week high of $161.57 from October 2025. Investors who bought $1,000 worth of Five Below’s shares 5 years ago would now be looking at an investment worth $1,028.
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