Kohl’s Stock Jumps 90% in Reddit Short Squeeze
Frenzy, Analysts Remain Cautious
Kohl’s Corporation (NYSE:KSS) stunned Wall
Street Tuesday morning as its stock soared
nearly 90% in early trading, driven by a massive Reddit-fueled short squeeze. Trading
volumes exploded as retail investors targeted the heavily shorted retailer in a
coordinated buying effort similar to earlier moves seen in stocks like GameStop
and AMC.
By midday, shares pulled back slightly but were still up over 63%, showing the momentum was far from over.
Why Did Kohl’s Stock Skyrocket?
According to data, over 53 million shares of Kohl’s were shorted roughly 49% of its 112 million share
float. That means almost half of Kohl’s
stock was being bet against. Such a high short interest often becomes
a prime target for retail traders looking
to trigger a squeeze.
That’s exactly what appears to have happened
Tuesday morning.
On Reddit’s r/WallStreetBets and other trading forums, users spotted Kohl’s high short interest and began rallying others to pile in. The buying pressure caused short sellers to cover their positions, pushing the stock even higher.
Analysts Still Cautious Despite Rally
Even with the explosive rally, Wall Street
experts aren’t fully convinced.
Goldman Sachs (NYSE:GS) did raise its price
target from $5 to $7, citing “a
pickup in sales growth and improved inventory management.” But even that is below the stock’s closing price of $9.58 on
Monday and far below the morning’s peak price.
This signals a disconnect between analyst expectations and retail trader
sentiment.
“We’re seeing another meme stock moment,” one analyst noted. “The fundamentals haven’t changed much overnight.”
Children’s Place Joins the Rally
Kohl’s wasn’t the only stock caught in the
short squeeze wave. Children’s Place
(NASDAQ:PLCE) jumped 19%
during Tuesday’s session. Like Kohl’s, Children’s Place has a high short interest of around 50%.
The movement suggests that Reddit traders are once again targeting multiple heavily shorted stocks not just one.
What’s a Short Squeeze Anyway?
A short
squeeze happens when investors who have bet against a stock (short
sellers) are forced to buy back shares to cover their losses. This rush of
buying drives the price up even more, triggering a cycle of upward momentum.
Retail traders on platforms like Reddit have learned how to spot these opportunities—especially in stocks with low float and high short interest—and use them to fuel sudden price surges.
Is Goldman Sachs a Buy in This
Market?
While Kohl’s stole the spotlight, some traders
are now looking at whether Goldman Sachs
(GS) could be next. AI-based model portfolios from ProPicks have recently shown strong
performance in selecting high-growth stocks. According to ProPicks:
·
2 stocks surged 150%+ this year.
·
4 gained 30%+.
·
3 climbed over 25%.
Whether Goldman Sachs is included in those portfolios could give insight into whether it’s seen as a bullish or bearish play right now.
Retail Investors or Market
Manipulators?
Kohl’s rally highlights the ongoing power of online communities in shaping market
behavior. But critics warn that such movements can create artificial volatility, leaving
latecomers holding the bag when prices crash.
“Reddit-driven rallies are thrilling but risky,” says an independent market strategist. “Always know what you’re buying and why.”
About Kohl’s: More Than Just Retail
Kohl’s is a mid-sized U.S. department store chain with over 1,100
stores across America. It sells clothing, home goods, beauty products, and more.
In recent years, Kohl’s has struggled with:
·
Slowing
sales
·
Online
competition
·
Shifting
consumer habits
Despite ongoing turnaround efforts, the stock has underperformed for years until now.
What’s Next for Kohl’s Stock?
With no major earnings updates or operational
changes announced, the current rally seems driven more by market mechanics than company fundamentals.
That makes it highly volatile and risky
in the short term.
However, if Kohl’s management can capitalize on the attention and improve business performance, the stock might find a more sustainable path forward.
Final Thoughts
Kohl’s stock’s 90% jump is a reminder of how powerful retail investors have
become in the age of social media. While the rally may cool off, the
interest from Reddit and retail traders isn’t going away anytime soon.
Whether you’re watching from the sidelines or considering a trade, it’s wise to understand the risks, follow the data, and not just the hype.
