SAN DIEGO, Sept. 13, 2024 (GLOBE NEWSWIRE) -- A class action lawsuit has been filed on behalf of purchasers or acquirers of Five Below, Inc. (NASDAQ: FIVE) (“FIVE” or the “Company”) securities between March 20, 2024 and July 16, 2024, inclusive (the “Class Period”), charging the Company and certain senior executives with violations of the federal securities laws (collectively, “Defendants”).
FIVE investors have until September 30, 2024 to seek appointment as lead plaintiff of the FIVE class action lawsuit.
If you purchased FIVE securities between March 20, 2024 and July 16, 2024, and suffered substantial losses, and you wish to obtain additional information or serve as lead plaintiff in this lawsuit, you may submit your information and contact us here: https://dicellolevitt.com/securities/FIVE/.
You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at investors@dicellolevitt.com. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
No Class Has Been Certified. Until a class is certified, you are not represented by counsel unless you retain one. You may select counsel of your choice.
Case Allegations
FIVE operates a chain of specialty discount stores where most products for sale are priced at $5 or less. The FIVE lawsuit alleges that Defendants misrepresented the Company’s financial strength and growth projections. For example, in March 2024 FIVE projected net sales of $826 million to $846 million in the first quarter of 2024 based on opening 55 to 60 new stores. This positive outlook extended to FIVE’s 2024 fiscal year, with Defendants stating the Company’s expected net sales would range from $3.97 billion to $4.07 billion based on opening 225 to 235 new stores throughout the year.
Unbeknownst to investors, these statements were false and misleading as macroeconomic pressures were interfering with the Company’s strategic operations and preventing FIVE from executing successfully.
The truth began to be revealed on June 5, 2024, when the Company announced disappointing sales for the first quarter of 2024 and reduced full year guidance for 2024. Specifically, FIVE announced its expected net income ranged from $275 million to $297 million and expected net sales for 2024 to range from “$3.79 billion to $3.87 billion based on opening approximately 230 new stores.” On this news, FIVE’s stock price dropped $14.07 per share, or 10.5%.
Then, on July 16, 2024, FIVE announced its President and Chief Executive Officer was resigning. At the same time, FIVE projected a decrease of 6% to 7% in sales for the second quarter of 2024.
Commenting on the Company’s disclosures, Wells Fargo wrote “the news confirms FIVE is broken growth” and that FIVE “sees much of its issues as self-inflicted, which has only exacerbated macro/trend/comparison issues.” Similarly, J.P. Morgan stated that FIVE’s “[m]anagement cited multi-year plans to remain a ‘growth company’ having ‘strayed’ from the historical three-fold playbook during and exiting the pandemic and citing the need to (i) Get back to trend-right product, (ii) Refocus on extreme values, and (iii) Execute to a more consistent, fun and enjoyable in-store experience.” Following FIVE’s announcement on July 16, 2024, the Company’s stock price declined by $25.57 per share, or 25%.
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