Five Below (NASDAQ:FIVE) stock was down 5% in early deals, trading at $173.20, after the discount retailer’s outlook underwhelmed – albeit quarterly financial performance was ‘in-line’ with market forecasts.
Sending shares lower was updated earnings guidance, reflecting an anticipated increase 'shrinkage' reserve (the amount it expects to lose due to theft and breakages) but its sales outlook remains unchanged.
For the full year, the company still expects revenue in the range of $3.50 to $3.57 billion but it now expects earnings per share (EPS) in the range of $5.27 to $5.55, compared to its previous guidance of $5.31 to $5.71.
It expects profits between $295 million to $311 million, down from its prior expectation of $297 million to $319 million.
For 2Q, being the three months ended July 29, 2023, Five Below (NASDAQ:FIVE) reported a 13.5% jump in sales to $759 million, just below the Street estimate of a 13.6% increase to $760.2 million.
Earnings per share topped expectations at $0.84, with analysts expecting $0.83 per Zacks Consensus Estimate.
Five Below (NASDAQ:FIVE) shares were down 5.7% at US$172.51 shortly after the release of its 2Q results.
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