Five Below Stock Shows Rising Relative Strength; Can It Break Away From The Pack?

Department stores have flourished as the pandemic wanes. Discount retailers not so much. The Retail Discount&Variety group is ranked a dismal 179 on IBD’s list of 197 industries. That may be changing though; discounters may be joining the party. On Wednesday, Five Below (FIVE) separated itself from the pack of discount retailers. It earned an upgrade to its Relative Strength (RS) Rating, from 69 to 73.


The 73 RS Rating means that Five Below stock has outperformed 73% of all stocks, regardless of industry group, over the past year. Stocks that go on to make the biggest gains typically have an RS Rating of at least 80 in the early stages of their moves. See if Five Below can continue to show renewed price strength and hit that benchmark.

Five Below Stock Ratings, Profits Climbing

Meanwhile, Five Below stock has earned an 87 EPS Rating, out of 99, amid outstanding profit growth, and an 82 Composite Rating.

The IBD Composite Rating helps investors easily measure the quality of a stock’s fundamental and technical metrics. The best growth stocks have a Composite Rating of 90 or better.

One yellow flag is its Accumulation/Distribution Rating, one of the five components of the Composite Rating. Five Below has a C- A/D Rating on an A+ to E scale. The C- rating means slightly more funds are selling than buying its shares.

Five Below saw both earnings and sales growth rise last quarter. Earnings-per-share soared 190% to 84 cents, on a 198% jump in revenue to $597.8 million. It’s recorded three quarters of double- or triple-digit sales and profit growth.

The company holds the No. 2 rank among its peers in the Retail-Discount & Variety industry group. Big Lots (BIG) is No. 1 and Dollar General (DG) is No. 3

Looking For The Best Stocks To Buy And Watch? Start Here

Five Below is trying to complete a flat base with a 205.38 entry. See if it can clear the breakout price in volume at least 40% higher than normal.

When you’re researching the best stocks to buy and watch, be sure to pay attention to relative price strength.

IBD’s proprietary RS Rating identifies technical performance by showing how a stock’s price movement over the last 52 weeks compares to that of the other stocks in our database.


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