Value
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 6.2 |
| P/S | 8.7 |
| EV/EBITDA | 1.9 |
| Fwd P/E | 6.1 |
| PEG | 7.1 |
| Analyst target | 7.5 |
- ▸Forward P/E: 21.2x
- ▸PEG: 0.98
FIVE · Why this verdict
Why Five Below (FIVE) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictSELL
Overall score6.5/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Four consecutive earnings beats averaging 56% above estimates and 32% year-over-year revenue growth combine with a sub-1 PEG ratio to offer compelling fundamental value 21% below analyst targets, though momentum remains soft and no clear near-term catalyst has been identified.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Revenue is growing at 32% year-over-year, placing the company at the top of its peer group by growth rank — a rate that, if sustained, justifies the current multiple. Growth breakdown | Revenue growth sustains above 20% in the next two reported annual periods, confirming the growth trajectory rather than a one-time base effect. | →Stable |
| CounterGrowth data carries reduced confidence due to limited data points, and at a high base, future comparisons become difficult; if the 32% rate reflects recovery-driven demand rather than structural share gains, the next period could reveal sharp deceleration. | ||
Management has delivered four consecutive earnings beats with an average positive surprise of 56%, suggesting a pattern of setting conservative expectations and consistently exceeding them. Earnings | EPS beats continue in at least 2 of the next 4 quarters, with average positive surprise remaining above 20% over that period. | ↑Improving |
| CounterThe unusually high average surprise rate is heavily skewed by a single quarter with a 165% beat; excluding that quarter, the underlying consistency and magnitude of outperformance may be more modest, and any normalization could end the streak. | ||
The stock is in an uptrend pullback — RSI has retreated to 34 while volume accumulation remains positive (rising OBV) and the price holds above the 200-day moving average, a combination that historically precedes recoveries within intact longer-term uptrends. Momentum breakdown | RSI recovers above 50 within 60 days and the stock closes within 5% of the $234.61 analyst consensus target within 12 months. | ↑Improving |
| CounterMomentum is soft, technical signals are mixed, and no clear chart pattern has been identified; the pullback could extend further before resolving, and without a confirmed catalyst the uptrend may not resume on its own. | ||
At a forward price-to-earnings multiple of 19.9x and a PEG ratio of 0.98, the stock is not pricing in the 32% growth rate — leaving room for multiple expansion if growth persists. Valuation breakdown | The forward price-to-earnings multiple expands toward 25x as growth is sustained, or the stock reaches the $234.61 analyst target within 12 months. | →Stable |
| CounterA sub-1 PEG implies that growth expectations are embedded in the denominator; if growth disappoints, the forward multiple would look stretched relative to slower-growing peers, driving compression rather than expansion. | ||
Revenue is growing at 32% year-over-year, placing the company at the top of its peer group by growth rank — a rate that, if sustained, justifies the current multiple.
→StableGrowth breakdown
- Expectation
- Revenue growth sustains above 20% in the next two reported annual periods, confirming the growth trajectory rather than a one-time base effect.
CounterGrowth data carries reduced confidence due to limited data points, and at a high base, future comparisons become difficult; if the 32% rate reflects recovery-driven demand rather than structural share gains, the next period could reveal sharp deceleration.
Management has delivered four consecutive earnings beats with an average positive surprise of 56%, suggesting a pattern of setting conservative expectations and consistently exceeding them.
↑ImprovingEarnings
- Expectation
- EPS beats continue in at least 2 of the next 4 quarters, with average positive surprise remaining above 20% over that period.
CounterThe unusually high average surprise rate is heavily skewed by a single quarter with a 165% beat; excluding that quarter, the underlying consistency and magnitude of outperformance may be more modest, and any normalization could end the streak.
The stock is in an uptrend pullback — RSI has retreated to 34 while volume accumulation remains positive (rising OBV) and the price holds above the 200-day moving average, a combination that historically precedes recoveries within intact longer-term uptrends.
↑ImprovingMomentum breakdown
- Expectation
- RSI recovers above 50 within 60 days and the stock closes within 5% of the $234.61 analyst consensus target within 12 months.
CounterMomentum is soft, technical signals are mixed, and no clear chart pattern has been identified; the pullback could extend further before resolving, and without a confirmed catalyst the uptrend may not resume on its own.
At a forward price-to-earnings multiple of 19.9x and a PEG ratio of 0.98, the stock is not pricing in the 32% growth rate — leaving room for multiple expansion if growth persists.
→StableValuation breakdown
- Expectation
- The forward price-to-earnings multiple expands toward 25x as growth is sustained, or the stock reaches the $234.61 analyst target within 12 months.
CounterA sub-1 PEG implies that growth expectations are embedded in the denominator; if growth disappoints, the forward multiple would look stretched relative to slower-growing peers, driving compression rather than expansion.
Per-dimension breakdown
Quality
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 9.4 |
| ROA | 5.2 |
| Gross margin | 3.5 |
| Op margin | 3.5 |
| Net margin | 5.8 |
| Current ratio | 7.7 |
| FCF quality | 4.6 |
| Moat | 6.8 |
| Piotroski F | 8.9 |
- ▸Excellent ROE: 28%
- ▸Earnings quality warning: 59% FCF/NI
- ▸Strong Piotroski F-Score: 8/9
Growth
8.2/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 8.2 |
- ▸Strong growth: 23% YoY
Momentum
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.8 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 9.0 |
| Volume | 3.1 |
- ▸Overbought (RSI 83)
- ▸Volume accumulation (rising OBV)
- ▸Above 200-day MA
Sentiment
7.3/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.5 |
| Price target | 8.6 |
| erm sentiment | 5.3 |
- ▸Analyst upside: 30%
Insider
5.4/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 8.1 |
| notable moves | 7.0 |
- ▸Modest insider selling — $5,646,020 (0.044% of mkt cap)
- ▸Institutions accumulating
Peer rank
6.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.9 |
| quality rank | 7.2 |
| growth rank | 7.4 |
- ▸Best-in-class margins
Technical
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.5 |
| support resistance | 1.3 |
| 52w position | 7.8 |
Risk (lower is worse)
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.4 |
| days to cover | 8.2 |
| volatility | 5.0 |
| put call | 2.8 |
| implied vol | 5.3 |
| max pain risk | 3.0 |
| beta | 7.3 |
| debt equity | 6.1 |
- ▸Elevated put/call: 1.59
- ▸Above max pain $100
Catalyst
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
- ▸Perfect beat streak: 4Q
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:7.2>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:34d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:1.2<1.5@spot
Warning (0)
none
Reward-to-Risk
1.23
Upside
+17.2%
Downside
14.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 5.0 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 8.2) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:1.2<1.5@spot) reinforce the read. Current asymmetry R:R is 1.23 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 8.2, Catalyst at 7.5, and Sentiment at 7.3; the weakest are Technical at 3.2, Insider at 5.4, and Risk (lower is worse) at 5.6. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 1.23 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings Beat Consistency
Trip ifEPS surprise falls below 0% for 2 consecutive quarters, ending the beat streak.
- P2Strong Revenue Growth Profile
Trip ifRevenue growth falls below 15% year-over-year for 2 consecutive quarters.
- P3Pullback Entry Technical Setup
Trip ifPrice closes below the 200-day moving average and remains there for more than 20 consecutive trading days.
- P4Reasonable Valuation For Growth
Trip ifPEG ratio rises above 1.5x on forward earnings estimates without a corresponding upward revision to analyst price targets.