FIVE - The Processes Are Structurally Stronger But the Comp Descent Must Be Navigated—At 11x EBITDA, We Stay BUY-Rated With A Lower $250 PT

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FIVE - The Processes Are Structurally Stronger But the Comp Descent Must Be Navigated—At 11x EBITDA, We Stay BUY-Rated With A Lower $250 PT

June 7, 2026

John Heinbockel john.heinbockel@guggenheimpartners.com FIVE - The Processes Are Structurally Stronger

212 381 4135 But the Comp Descent Must Be Navigated—At 11x

Steven Forbes, CFA, CPA

steven.forbes@guggenheimpartners.com EBITDA, We Stay BUY-Rated With A Lower $250 PT

212 381 4188

Julio Marquez Key Message: The seeming dichotomy between the robust 1Q print and subsequent julio.marquez@guggenheimpartners.com sell-off reflects the forthcoming steep normalization in comp momentum which carries 212 823 6605

little significance for the secular story but, until the floor is established, dissuades

Jacob Nivasch incremental buyers. Unusually healthy “trend” results partially drove an 800-basis point

jacob.nivasch@guggenheimpartners.com comp acceleration to 23% and a doubling in EBIT margin, a performance akin to the

212 338 8837 COVID recovery in early 2022, which gave way to a period of top and bottom-line declines

Max Horowitz and a meaningful pull-back in the shares. Stronger operational processes would serve the

max.horowitz@guggenheimpartners.com business well, with shallower, if any, P&L givebacks, and a more muted near-term share

212 518 9974 price underperformance. At 11x 2026E EBITDA—see Exhibit 1—they are compelling for

a mid-teen’s growth algo and we, thus, remain BUY-Rated, although we are lowering our

price target to $250 from $260.

The Peak Descent Got Steeper With The 1Q Beat. Given the pervasive and highly visible FIVE BUY

Five Below, Inc. product development and third-party data strength during the past several months, the 1Q’s