MENOMONEE FALLS, Wis. – Kohl’s is making headlines in the financial world, as Kohl’s Cash isn’t the only thing going up and down in value this week.
What we know:
The Menomonee Falls-based retail company has recently become a “meme stock.” The company’s shares have skyrocketed this week, despite the company’s struggles.
On Wall Street, a meme stock is when a publicly traded company’s shares get a big boost online.
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“People getting together and talking about, ‘hey lets buy this stock’ and then it just drives the price up,” Annex Wealth Management Chief Economist Brian Jacobsen said. “A meme is basically people mimicking what others do. It’s this, like, cultural element where it spreads amongst a community and so a meme stock is where there’s not really a lot of fundamental news about – like earnings, or growth for a business.”
Think GameStop, AMC and Blackberry in 2021.
“GameStop went from basically being a company that was almost going bankrupt to one that almost got a second life because of all the media attention that they got,” Jacobsen said. “Now, will that happen with Kohl’s or not? We don’t know of course.”
Dig deeper:
The surge in the company’s shares come despite low sales and several leadership changes.
“If you just look back at what happened over the last few days, you know Kohl’s stock went from around $9, it went up to $17 – so almost doubling, but then back down to $12,” Jacobsen said. “This could be like a flash in the pan. Where it shoots up, and then it suddenly comes back down. That is common with meme stocks.”
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Jacobsen said it’s important for investors to be careful with meme stocks.
“It’s one of those things where, if you see that it has happened, it’s interesting – but maybe very difficult to profit from,” he said.
Kohl’s stock is currently right above $12.
The Source: The information in this post was collected and produced by FOX6 News.
