Kohl's Stock Surges 40% as Meme Stock Traders Spark Unusual Rally

Braking News update July 22, 2025

Kohl's Stock Surges 40% as Meme Stock Traders Spark Unusual Rally

Published: July 22, 2025 | By: MarketWatch Desk

Keywords: Kohl’s stock jump, meme stock rally, Kohl’s share price, Reddit WallStreetBets, short squeeze, retail stock news, KSS stock news, Kohl’s back-to-school deals

Shares of Kohl’s Corporation (KSS) skyrocketed over 40% in midday trading on Tuesday, attracting the attention of both investors and online meme-stock traders. The surge occurred despite the absence of any new company announcements or earnings reports, leading analysts to speculate that a Reddit-fueled short squeeze might be in play.

The stock was briefly halted for volatility earlier in the morning, but resumed trading with strong momentum. The dramatic price movement appears to be driven largely by conversations on WallStreetBets, a popular subreddit known for targeting heavily shorted stocks.

Reddit Traders Fuel the Rally

While no corporate updates have been released, Kohl's high short interest has made it an attractive target for retail investors looking to trigger another meme-stock rally. Similar to past events involving GameStop and AMC, traders are speculating that institutional investors may be forced to cover short positions, driving prices even higher.

This sudden jump has nearly erased the company’s year-to-date losses, which previously shaved off about 25% of Kohl’s market value.

Turmoil and Turnaround at Kohl’s

The surge comes amid internal shifts at Kohl’s. In early 2025, the company launched a major turnaround strategy, aimed at reviving sluggish sales and streamlining promotions. Former CEO Ashley Buchanan spearheaded the plan but was ousted just two months later due to a controversial personal conflict of interest.

Despite executive instability, Kohl’s first-quarter earnings in May outperformed expectations. Last week, the retailer also promoted its back-to-school campaign, offering hundreds of essential items under $10, particularly from its private label brands.

Wall Street Outlook Remains Cautious

Despite the sudden stock surge, analysts remain wary. Visible Alpha’s average price target sits at $8 per share—well below Tuesday's intraday highs. UBS analysts recently reaffirmed a $4 target, while Goldman Sachs increased theirs to $7, citing improved inventory levels and steady sales.

Final Takeaway

While Kohl’s faces long-term challenges in the retail landscape, its recent surge highlights the unpredictable power of retail investors and social media sentiment. Traders and analysts alike will be watching closely to see if this rally sustains or fizzles as fast as it began.