Larger Tax Refunds on the Way: Which Retailers Will Benefit the Most?
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 24 2026
0mins
Source: Barron's
Impact on Wealthier Shoppers: Wealthier shoppers are expected to benefit significantly from President Trump's new tax bill, which is likely to provide them with larger refunds.
Retailers' Advantage: Retailers that cater to wealthier consumers are positioned to gain the most from the economic changes brought about by the tax bill.
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Analyst Views on FIVE
Wall Street analysts forecast FIVE stock price to fall
19 Analyst Rating
11 Buy
7 Hold
1 Sell
Moderate Buy
Current: 201.970
Low
132.00
Averages
193.47
High
242.00
Current: 201.970
Low
132.00
Averages
193.47
High
242.00
About FIVE
Five Below, Inc. is a specialty value retailer offering merchandise targeted at the tween and teen demographics. Its assortment of products, including select brands and licensed merchandise. It is engaged in offering a group of products, including leisure, fashion and home, and snacks and seasonal. Leisure includes items such as sporting goods, games, toys, tech, books, electronic accessories, arts and crafts, and party. Fashion and home include items, such as personal accessories, attitude t-shirts, beauty offerings, home goods and storage options. Snack and seasonal include items, such as seasonal goods, greeting cards, candy and other snacks, and beverages. It also offers its merchandise on the Internet, through its fivebelow.com e-commerce Website, offering home delivery and the option to buy online and pick up in store. It also sells its merchandise through on-demand third-party delivery services to enable its customers to shop online and receive convenient delivery.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Improved Profitability: Gross margins widened by nearly four percentage points, and earnings per share (EPS) more than doubled year-over-year, demonstrating effective execution in cost control and sales growth, although market reactions were less favorable.
- Cautious Market Outlook: Management warned of
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- Five Below's Continued Growth: Five Below's Q1 EPS soared 158% to $2.22, with sales exceeding $1.28 billion, surpassing estimates, reflecting strong customer demand for its value-oriented merchandise and the positive impact of new store openings.
- Retail Sector Trends: The retail earnings season highlights that companies with strong brands and effective execution are thriving, as Ulta, Victoria's Secret, and Five Below all exceeded earnings expectations and raised full-year guidance, presenting attractive investment opportunities.
See More
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- Strong Job Data: The May jobs report revealed an increase of 172,000 jobs, slightly down from the revised 179,000 but significantly above the expected 80,000, indicating robust economic recovery that may influence the Federal Reserve's monetary policy direction.
- Lululemon's Dim Outlook: The athletic apparel retailer cut its full-year guidance and provided a weak outlook for the current quarter, leading BTIG to downgrade its rating from buy to hold, resulting in an over 11% drop in premarket trading, reflecting market concerns about its future performance.
- CrowdStrike's Mixed Results: Despite reporting stronger-than-expected results and raising its full-year outlook, CrowdStrike's shares fell 4% as investors questioned why heightened attention to its AI model did not immediately translate into financial results, indicating cautious market sentiment regarding its growth potential.
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- Crude Oil Prices Decline: WTI crude oil prices fell over 3%, lowering inflation expectations and pushing the 10-year T-note yield down 2 basis points to 4.47%, providing support for both stock and bond markets, indicating a complex market reaction to economic outlooks.
- Jobless Claims Rise: Initial jobless claims in the US increased by 13,000 to 225,000, marking a 3.75-month high, suggesting a weaker labor market, although unit labor costs were unexpectedly revised down to 1.8%, easing concerns over wage pressures.
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See More
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- Strong Sales Performance: Five Below's Q1 net sales surged 32.5% year-over-year to $1.3 billion, reflecting robust performance in the discount retail sector, although investors express concerns about the sustainability of future growth.
- Store Expansion: The company opened 49 new stores during the quarter, bringing its total to 1,970 locations across 46 states, a strategic move that enhances its market share and geographic reach.
- Comparable Sales Growth: Existing store comparable sales jumped 22.7%, indicating significant success in attracting both new and existing customers, particularly driven by viral social media trends.
- Profitability Boost: Adjusted net income soared 160% to $123.5 million, or $2.22 per share, exceeding Wall Street's expectations of $1.79, showcasing effective management in cost control and sales growth.
See More
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- Tech Sector Decline: Broadcom's stock plummeted over 14% due to disappointing AI revenue forecasts, leading to a broader decline in chipmakers, while CrowdStrike fell more than 8% despite beating Q1 earnings expectations, reflecting market caution towards tech stocks.
- Mixed Economic Data: Initial jobless claims rose to 225,000, a 3.75-month high, indicating a weaker labor market, while Q1 nonfarm productivity was revised down to 0.3%, below expectations, potentially impacting future economic growth outlooks.
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