An ascending triangle pattern has emerged in the chart of Five Below (FIVE). This is a bullish pattern and if the resistance level is surpassed, a breakout could occur…
Five Below (FIVE) is a value-oriented retailer that operates over 900 stores in the United States. Catering to teen and preteen consumers, stores feature a wide variety of merchandise, the vast majority of which is priced at or below $6.
The company has been focused on enhancing its merchandise assortment, improving its supply chain, and strengthening its digital capabilities. It is also working on expanding its store base and enhancing the in-store experience to drive more traffic.
FIVE has a healthy balance sheet with a current ratio of 1.4, indicating it has enough liquidity to handle short-term obligations. While growth struggled over the past year, earnings are forecasted to rise 144% in the current quarter.
Due to its growth expectations, the stock is trading at a fairly high multiple with a forward P/E of 46.51. The stock has also shown recent positive momentum, leading to a Momentum Grade of B in our POWR Ratings, and represented by the chart below.
Take a look at the 1-year chart of FIVE below with my added notations…
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