Loop Capital upgrades Five Below to Buy on merchandising and pricing changes.

Loop Capital upgrades Five Below to Buy from Hold with a price target of $165, up from $130. The firm believes the market is underestimating the company's near-term earnings power following its recent merchandising and pricing changes. Loop sees current share levels as an attractive entry point, citing lower shrink as a tailwind in the second half of 2025.

Loop Capital has upgraded Five Below, Inc. (NASDAQ: FIVE) to a "Buy" rating from "Hold" with a new price target of $165, up from $130. The firm believes the market is underestimating the company's near-term earnings power following its recent merchandising and pricing changes. Loop Capital sees current share levels as an attractive entry point, citing lower shrink as a tailwind in the second half of 2025.

Five Below reported a quarterly earnings increase, posting $0.86 earnings per share, which exceeded analysts' expectations and reflected a 19.5% year-over-year revenue growth. The company's recent merchandising and pricing changes are expected to boost its near-term earnings power, according to Loop Capital. The firm also notes that lower shrink, a measure of inventory loss, is expected to be a tailwind for the company in the second half of 2025.

Loop Capital's upgrade comes amid a mixed analyst sentiment towards Five Below. While some analysts have upgraded their price targets, others have maintained their ratings or downgraded the stock. As of the latest data, Five Below has an average rating of "Hold" and a consensus target price of $119.00.

Reference List:
[1] https://www.marketbeat.com/instant-alerts/filing-five-below-inc-nasdaqfive-shares-sold-by-blair-william-co-il-2025-08-08/