Stock market today: S&P 500 ekes out closing record high despite wobble in chips
Investing.com -- Kohl’s (NYSE: NYSE:KSS) stock soared as much as 90% Tuesday morning on massive trading volume as a surge in Reddit interest triggered a short squeeze in the heavily shorted retailer.
The dramatic rally comes as Kohl’s faced significant short interest of approximately 53 million shares, representing about 49% of its 112 million share float, according to recent data. This high level of short interest made the stock vulnerable to a coordinated buying effort, similar to previous Reddit-driven rallies in heavily shorted stocks.
Wall Street analysts have maintained largely negative or neutral stances on Kohl’s. Goldman Sachs recently raised its price target on the stock from $5 to $7, citing "reacceleration in top line growth and cleaner inventories." However, this target remains well below Monday’s closing price of $9.58, highlighting the disconnect between the current rally and fundamental analyst valuations.
The short squeeze phenomenon extended beyond Kohl’s, with Children’s Place (NASDAQ:PLCE) also gaining 19% on Tuesday. Children’s Place similarly carries a high short interest of 50%.
After the market open, Kohl’s shares had retreated somewhat from their morning highs but remained up approximately 63% for the session, reflecting the continued momentum of the short squeeze.