The inside of one of Five Below’s existing locations.
Here are the biggest calls on Wall Street on Monday:
J.P. Morgan added Five Below to the analyst ‘focus list’
J.P. Morgan added the stock to the focus list and said it views the pullback in shares as a buying opportunity for the discount retailer.
“FIVE targets 20% annual revenue growth on high-teens unit growth expansion and low-single-digit comps with roughly flat margins and a 3% fixed cost hurdle equating to 20% net income growth. Importantly, we see high visibility to +20% annual net income growth based on (1) high-teens unit growth with new store returns the sole governor, (2) low-single-digit “core” comps on positive store traffic, and (3) margin expansion driven by scale citing opportunity to reduce today’s +3% fixed cost hurdle over time.”
Read more about this call here.
Goldman Sachs downgraded Sherwin-Williams to ‘neutral’ from ‘buy’
Goldman Sachs downgraded the building materials company mainly on valuation.
“Given the recent outperformance of the shares (approaching our price target) and relative valuation, we see risk/reward in the name as less compelling versus other stocks in our coverage universe. Since being added to the Buy List and CL on June 8, 2017, SHW is up 71% vs. S&P 500 +28%.”