Five Below, Inc. Securities Lawsuit Investigation

Shamis & Gentile P.A., a law firm that advocates for investors who are victims of securities fraud, is investigating potential claims against Five Below (NASDAQ: FIVE).

If you purchased or held Five Below securities and suffered losses, you may be eligible to join this securities investigation and seek compensation.

The matters described are allegations, not findings of fact. No court has determined liability.

About Five Below

Five Below, Inc. is a specialty value retailer incorporated in Pennsylvania. The company targets the tween and teen demographic, offering trend-right, high-quality products, most priced at $5 and below, with select items above $5.

As of February 1, 2025, Five Below operated 1,771 stores across 44 states, with a strategy focused on aggressive store growth and rapid merchandising.

What's Being Investigated?

According to a recent class action complaint and related reports, Five Below and certain officers and directors are alleged to have provided investors with false or materially misleading information regarding the company’s financial strength and operational outlook for the first quarter and full year 2024.

The complaint contends that management’s statements about sales guidance and growth prospects may have omitted or downplayed known adverse trends, such as declining comparable sales and elevated inventory shrink.

On June 5, 2024, Five Below announced disappointing first quarter 2024 results and cut its full-year 2024 guidance. The company reported that net sales were expected to be in the range of $3.79 billion to $3.87 billion, down from the previous outlook, and projected second quarter net sales between $830 million and $850 million. Following these disclosures, Five Below’s stock price reportedly declined by $14.07 per share in a single day. Investors allege that these developments resulted in significant losses and may have stemmed from earlier misstatements or oversight failures.

Key Timeline

• March 20, 2024 — Five Below issues initial FY2024 guidance, forecasting Q1 net sales of $826–$846 million and full-year net sales of $3.97–$4.07 billion.
• June 5, 2024 — The company reports Q1 net sales of $811.9 million (below guidance), comparable sales down 2.3%, and cuts FY2024 net sales guidance to $3.79–$3.87 billion. Second quarter guidance is also below prior estimates.
• June 6, 2024 — Five Below’s stock price drops $14.07 per share (about 10.6%) following the earnings and guidance cut.
• July 16, 2024 — CEO Joel D. Anderson resigns; Five Below further lowers Q2 guidance to $820–$826 million.
• December 4, 2024 — Winnie Y. Park is named CEO, effective December 16, 2024.

Possible Legal Pathways

Several legal avenues may be available:

• Derivative Actions: Shareholders may pursue a derivative lawsuit on behalf of Five Below under Pennsylvania law, alleging breaches of fiduciary duty, oversight failures, or unjust enrichment. Pennsylvania requires a pre-suit written demand to the board, and courts may defer to a Special Litigation Committee (SLC) if one is formed.
• Securities Class Actions: Parallel class actions have been filed alleging violations of federal securities laws, including claims under Section 10(b) and Rule 10b-5.
• Books-and-Records Demands: Shareholders may request corporate records under Pennsylvania law to investigate potential wrongdoing before filing suit.

What Investors Can Watch Next

• Upcoming Earnings Releases: Investors may monitor future earnings announcements for further disclosures or revised guidance.
• Board or Committee Actions: Any governance changes or public statements from the board or audit committee could be relevant.
• Court Filings: If a derivative lawsuit or additional regulatory actions are filed, those developments may provide new information.
• Books-and-Records Process: Outcomes of any shareholder inspection demands under Pennsylvania law could impact the investigation.

If additional milestones are announced, they will be reflected in future updates.

Your Rights and Next Steps

If you held Five Below shares and believe you suffered losses, you may have the right to participate in this ongoing investigation. Under Pennsylvania law, shareholders seeking to bring a derivative action must first make a detailed written demand on the board, outlining the specific allegations and supporting facts. The board may then investigate, often through a Special Litigation Committee (SLC), and decide whether to pursue the claims on behalf of the company.

Shareholders also have the right to request access to certain corporate books and records under Pennsylvania’s inspection statute. This process can help develop the factual basis for any potential claims and is often a critical step before filing suit.

If the board or SLC declines to act or if the investigation reveals grounds for further action, shareholders may seek monetary recovery to the company, governance reforms, or other remedies through the courts.

You May Be Entitled to Compensation

Securities investigations are time-sensitive. If you purchased or held Five Below securities during the period in question and experienced losses, you may be eligible to join this investigation and help protect your rights.

To participate, complete the form below to join the investigation and receive updates on potential recovery options.