1. Kohl’s Corporation (NYSE:KSS)
% of Institutional Ownership: 121.16%
Float Shorted: 30.53%
Kohl’s Corporation is an omnichannel retailer based in the United States and ranks first on our list of stocks that hedge funds are shorting. The company’s earnings in Q1 FY2024 were disappointing, with revenue of $3.2 billion, a 5.3% reduction from the same time the previous year, falling short of Wall Street’s revenue projections of $3.34 billion due to weaker customer demand for its apparel and footwear.
In comparison to a $14 million profit a year earlier, Kohl had a net loss in terms of revenue of $27 million for the first quarter. Kohl’s also noted that reduced clearance sales compared to last year had a more than 600-basis-point impact on comparable sales, which fell 4.4% in the first quarter. The business expects fiscal 2024 net sales to decline between 2% and 4%, down from its earlier estimate of a 1% dip and a 1% increase.
It forecasts annual profits per share to be between $1.25 and $1.85, up from its earlier prediction of $2.10 to $2.70. However, the retailer praised the success of its shop-in-shop collaboration with Sephora. It has expanded the number of Sephora shops inside its stores. In March, a similar agreement was made by Kohl’s and Babies R Us. Kohl’s has made an effort to attract customers by introducing new products, including gifts, pet supplies, and home decor.
So far this year, the stock is down more than 18%, behind the S&P 500, which is up 15%, implying that Kohl’s has underperformed the market.
In Q1 2024, 36 hedge funds in Insider Monkey’s database held stakes in Kohl’s Corporation (NYSE:KSS), an increase from 31 in the previous quarter. These stakes are worth over $286.24 million in total. John Overdeck And David Siegel’s Two Sigma Advisors is the firm’s biggest investor since it owns 2,219,700 shares worth $64.70 million.
While we acknowledge the potential of short-selling stocks, our conviction lies in the belief that going long on some AI stocks holds greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is promising, check out our report about the cheapest AI stock.
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