Five Below Inc (NASDAQ:FIVE) stock fell 2.11% (As on March 16, 11:05:46 AM UTC-4, Source: Google Finance) after the company surpasses earnings and revenue estimates for the fourth quarter of FY 22. Comparable sales for the quarter increased 1.9% compared with an increase of 3.4% registered in the year-ago period. The comp increase was driven by an increase in comp transaction of 2.8% which was partially offset by a decline in comp average ticket of 0.9% in the reported quarter. During the holiday period, comparable sales increased 0.9%. Gross profit grew 14% year over year to $452.4 million and gross margin expanded approximately 50 basis points (bps) to 40.3%. This increase was primarily driven by cost management strategies in distribution and freight expenses, which were partially offset by higher-than-expected shrink.

FIVE in the fourth quarter of FY 22 has reported the adjusted earnings per share of $3.07, beating the analysts’ estimates for the adjusted earnings per share of $3.06, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 12.7 percent to $1.12 billion in the fourth quarter of FY 22, beating the analysts’ estimates for revenue of $1.11 billion.

Additionally, Five Below ended the fiscal year with cash and cash equivalents of $332.3 million and short-term investment securities of $66.8 million. Total shareholders’ equity was $1,361.9 million as of Jan 28, 2023. In fiscal 2022, Five Below repurchased 247,132 shares for approximately $40 million.

Five Below anticipates gross capital expenditures of approximately $325 million in fiscal 2023, excluding tenant allowances. Five Below envisions first-quarter fiscal 2023 net sales in the range of $723 million to $735 million, up from $639.6 million reported in the first quarter of fiscal 2022. The company expects comparable sales to increase in the range of 2.5-4% in the first quarter. Management also expects operating margin in the range of 5.7% to 6.2% in the same period. Management anticipates first-quarter earnings between 59 cents and 65 cents per share compared with 59 cents reported in the year-ago period. Management projects fiscal 2023 net sales in the band of $3.49 billion to $3.59 billion, up from $3.1 billion reported in fiscal 2022. Five Below anticipates comparable sales to be up 1-4% in fiscal 2023. Management guided earnings between $5.25 and $5.76 per share for fiscal 2023, an increase from $4.69 reported in the year-ago period.