Five Below, Inc. (FIVE): Among Richard Chilton's Stock Picks with Huge Upside Potential
Richard Chilton is a veteran investor and the founder of Chilton Investment Company, a long-standing and respected name in the world of hedge funds. Known for his disciplined, research-driven investment philosophy, Chilton has built a reputation over the decades for being a thoughtful, value-oriented manager who combines patience with a deep understanding of market fundamentals.
He launched Chilton Investment Company in 1992 after gaining experience at major firms like Allen & Company and Alliance Capital. From the beginning, his approach stood out. Instead of chasing fast money or following trends, Chilton focused on long-term opportunities grounded in detailed analysis and risk management. His fund, which started with just $5 million, grew significantly over the years as investors recognized the strength of his strategy and the consistency of his returns.
READ ALSO: 10 Most Undervalued Energy Stocks and 15 High-Growth Companies Hedge Funds Are Buying.
Chilton's style is often described as "fundamental, bottom-up investing". Essentially, he and his team dig into company financials, industry dynamics, and management quality before making any investment decisions. This focus on quality and sustainability has helped the firm navigate multiple market cycles with relatively steady hands. Chilton is known to favor businesses with strong competitive advantages and predictable cash flows — companies that can weather downturns and continue compounding returns over time.
Chilton Investment Company has navigated the complexities of the post-pandemic market landscape with a focus on disciplined investment strategies, delivering solid returns for its clients. Today, Chilton Investment Company remains a respected player in the asset management world, guided by the same principles Richard Chilton laid out over 30 years ago: deep research, long-term thinking, and a strong sense of fiduciary duty. With that context in mind, let's take a look at Richard Chilton's 10 stock picks with huge upside potential according to analysts.
For this list, we picked stocks from Chilton Investment Company's 13F portfolio as of the end of the fourth quarter of 2024. We listed them in the ascending order of analysts' average upside potential, as of May 2. These equities are also popular among other hedge funds.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A family happily shopping for everyday items in a specialty retail store.Upside Potential: 24.74%
Number of Hedge Fund Holders: 48
Five Below, Inc. (NASDAQ:FIVE) is a fast-growing value retailer targeting tweens, teens, and broader age groups with trend-driven, high-quality products mostly priced at $5 or less. Offering items across eight categories—from Style to Tech—the brand emphasizes fun, affordability, and a dynamic in-store experience. Since opening its first store in 2002, Five Below has expanded to 1,340 locations in 42 states, with plans for 200 new stores in 2023 and long-term growth potential to over 3,500. The company also sells online through its website and same-day delivery services.
Five Below, Inc. (NASDAQ:FIVE) is sharpening its focus on delivering trend-right products at compelling value, emphasizing core price points of $1–$5 and enhancing its higher-priced offerings. The company is leveraging speed to capitalize on trends, simplifying pricing, and improving store operations to enhance the customer experience. Despite mitigation efforts, tariffs are expected to create a ~100-basis-point margin headwind in 2025, according to the company. Marketing investments and new product development aim to reinforce brand value, while long-term margin recovery is expected through shrink improvement, sourcing expansion, and operational efficiency, according to the company.
Overall FIVE ranks 7th on our list of billionaire Richard Chilton's stock picks with huge upside potential. While we acknowledge the potential of FIVE as an investment, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than FIVE but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
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