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Five Below Jumps as Analysts Laud Productivity, Growth Potential

Kids-focused discount retailer Five Below posted stronger-than-expected first-quarter results.

Shares of Five Below  (FIVE) - Get Five Below, Inc. Report jumped Friday after the kids-focused discount retailer  swung to a first-quarter profit from a year-earlier loss and some analysts were bullish on its growth prospects. 

Shares of Five Below at last check were 3% higher at $183.28.  

GAAP earnings of 88 cents a share compared with a loss of 91 cents a share in the year-earlier period and topped the consensus analyst estimate compiled by FactSet of 65 cents a share. 

Revenue of $597.8 million at the Philadelphia company nearly tripled from a year earlier and beat the estimate of $553.4 million. 

Comparable sales more than doubled (up 162%) from a year earlier.

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Analysts at Jefferies maintained their buy rating and $300 price target. "FIVE brand awareness continues to grow and [long-term] mature sales levels will continue to rise," the investment firm said.

RBC Capital also affirmed an outperform rating while raising its price to $234 a share from $225. "New-store productivity continues to climb and the company still has material unit-expansion potential," the firm wrote.

Telsey Advisory Group rates the company outperform and increased its price target to $240 from $230: "We remain encouraged by the strong business momentum at Five Below and its ability to execute at a high level."

KeyBanc Capital maintained its sector-weight rating. Five Below's long-term outlook "remains compelling" and the company is "one of the more intriguing growth stories in our coverage," the firm said. 

For the second quarter, the company expects earnings between $1.01 and $1.13 a share, compared with the FactSet-derived consensus estimate of 73 cents. 

Revenue is expected to range $640 million to $660 million vs. the estimate of $584 million.