Kohl’s (KSS) has become the latest retail stock to catch fire in this month’s meme stock mania, following in the footsteps of Opendoor (OPEN). On Tuesday morning, shares of the struggling retailer surged over 30%, prompting the New York Stock Exchange to halt trading due to extreme volatility. In premarket action, Kohl’s stock had soared more than 100% at its peak.
Much like Opendoor, Kohl’s attracted a wave of retail traders who pushed the stock from around $10.70 in early trading to a high of $21.39 before the exchange stepped in. After surging more than 40% and doubling at its highs on Monday, Opendoor’s shares were slightly down by about 1% in early trading Tuesday.
No major corporate news or analyst upgrades were linked to the surge, but Kohl’s has all the hallmarks of a meme stock. It is a well-known retailer with more than 1,100 stores nationwide, and it carries a significant short interest—around 50% of its shares are sold short, according to FactSet.
In recent years, Kohl’s has been a target for takeover bids, activist investors, and even bankruptcy speculation. Neil Saunders, managing director of GlobalData, said, “There’s a lot of irrational exuberance around the stock. It’s a very similar thing to what we saw with Bed Bath & Beyond back in the day. There’s nothing really that Kohl’s has done to fundamentally earn this level of increase. The business fundamentals remain quite weak.”
The WallStreetBets community, which rose to prominence during the 2021 GameStop short squeeze, has recently been discussing Kohl’s as a potential short squeeze candidate, given its high short interest and strong retail investor recognition.
A short squeeze occurs when investors betting against a stock are forced to buy shares to cover their positions as prices rise, which can push the stock even higher.
Despite the stock action, Kohl’s business fundamentals remain challenged. Sales have been declining, competition is increasing, and the company is currently led by interim CEO Michael Bender after former CEO Ashley Buchanan was removed amid a conflict of interest scandal.
Kohl’s stock has experienced a steep decline from its post-pandemic highs near $60 to a 52-week low of $6.04 in April. The company’s shares are heavily shorted, with a short float near 49%, reflecting widespread bets against the retailer. This has drawn significant attention on retail forums like Reddit’s WallStreetBets, where traders often target heavily shorted stocks to trigger “short squeezes.” Opendoor also remains heavily shorted, but with a lower short float of around 21%.
Following a 6.7% same-store sales drop in its fiscal fourth quarter ending March, Kohl’s shares fell 24%. Net sales for the quarter totaled $5.2 billion. Then-CEO Ashley Buchanan announced a turnaround plan focusing on core offerings like Sephora and value items but was removed in May amid an ethics investigation. Interim CEO Michael Bender now leads the company, which reported a 4.1% same-store sales decline in Q1 2025 and $3 billion in net sales. Kohl’s anticipates same-store sales to decline 4%-6% for fiscal 2025.
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