What Happened?
Shares of department store chain Kohl’s (NYSE: KSS) jumped 2% in the afternoon session after the company received analyst upgrades and saw a surge in interest from retail investors, partly fueled by a stronger-than-expected earnings report.
This heightened trading activity was also tied to the company's identification as a "meme stock mover," which amplified price swings beyond what would typically result from analyst commentary alone.
After the initial pop the shares cooled down to $17.20, up 1.8% from previous close.
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What Is The Market Telling Us
Kohl’s shares are extremely volatile and have had 47 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 5 days ago when the stock gained 4.4% on the news that analysts raised their price targets for the company, signaling a more optimistic valuation outlook.
Baird lifted its price target to $17.00 from $15.00, though it maintained a Neutral rating on the shares. In a more dramatic move, Morgan Stanley boosted its target by 80% to $9.00 from a prior $5.00. However, Morgan Stanley kept its cautious 'Underweight' rating, suggesting that while the firm saw a higher potential price, underlying business concerns remained. The stock was also flagged as a "meme stock mover," which pointed to heightened interest from retail traders possibly fueling some of the buying pressure.
Kohl's is up 22.6% since the beginning of the year, but at $17.20 per share, it is still trading 18.5% below its 52-week high of $21.10 from September 2024. Investors who bought $1,000 worth of Kohl’s shares 5 years ago would now be looking at an investment worth $853.60.
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