Gordon Haskett sees ‘return to its roots,’ upgrades Five Below to Buy

Gordon Haskett analyst Chuck Grom upgraded Five Below (FIVE) to Buy from Hold with a $120 price target Looking back over the past few years, it is “clear to us” that Five Below got complacent and became too preoccupied with its “triple-double” long-term algorithm, its virtual management team structure backfired, and its move to higher price points led to less discipline, the analyst tells investors. However, with the return of co-founder Tom Vellios and COO Ken Bull acting as interim CEO, the firm expects to see Five return to its roots with a heighted focus on offering trend-right products at a compelling value in a fun store experience. In the near-term, the firm’s data checks show trends seem to have bottomed and “are even showing signs of some modest improvement,” the analyst added.