Bank of America warns Five Below faces challenges from new China tariffs

Bank of America has reiterated its "Underperform" rating on Five Below, citing risks from new tariffs on Chinese imports. An additional 10% tariff took effect on February 4, impacting Five Below, which sources 50-60% of its products from China. The bank noted that Five Below has limited options to offset rising costs. It highlighted concerns about the retailer's pricing power and ability to maintain sales growth amid these challenges. While the suspension of a previous exemption may reduce competition from rivals, Bank of America sees ongoing difficulties for Five Below in boosting sales.