Small-Cap Stocks Surge, Outperforming Large-Caps in 2026
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4 days ago
0mins
Should l Buy KSS?
Source: seekingalpha
- Small-Cap Outperformance: Year-to-date in 2026, the iShares Core S&P Small-Cap ETF (IJR) has surged 10.9%, significantly outperforming the SPDR S&P 500 ETF Trust (SPY), which only rose 1.4%, indicating a potential shift in investor sentiment towards small-cap stocks after years of underperformance.
- Leading Stocks: Kohl's (KSS) tops the list with an 18.49% price percentage above the 200-day simple moving average (200DSMA), followed closely by Newegg Commerce (NEGG) and LGI Homes (LGIH), suggesting strong performance in the consumer discretionary sector that could drive increased investment interest in these industries.
- Divergent Ratings: Among the top performers, Revolve Group (RVLV) and Pursuit Attractions (PRSU) have received Buy ratings, while Kohl's (KSS) and G-III Apparel Group (GIII) maintain Hold ratings, reflecting varying levels of market confidence that may influence investor decisions.
- Market Dynamics: The robust performance of consumer discretionary stocks contrasts with stagnating retail sales, indicating that despite broader economic challenges, specific small-cap stocks continue to attract investor attention, potentially signaling a shift in market dynamics.
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Analyst Views on KSS
Wall Street analysts forecast KSS stock price to rise
13 Analyst Rating
1 Buy
7 Hold
5 Sell
Moderate Sell
Current: 18.920
Low
7.00
Averages
19.58
High
25.00
Current: 18.920
Low
7.00
Averages
19.58
High
25.00
About KSS
Kohl's Corporation is an omnichannel retailer. The Company operates approximately 1,100 stores and a Website www.Kohls.com. The Company’s Kohl's stores and Website sell private and national brand apparel, footwear, accessories, beauty, and home products. The Company’s Kohl's stores generally carry a consistent merchandise assortment with some differences attributable to local preferences, store size, and Sephora at Kohl's shop-in-shops (Sephora shops). Its Website includes merchandise, which is available in the Company’s stores, as well as merchandise that is available only online. Its merchandise mix includes both national brands and private brands that are available only at Kohl's. Its private portfolio includes established brands such as Apt. 9, Croft & Barrow, Jumping Beans, SO, Sonoma Goods for Life, and Tek Gear, and nationally recognized brands such as LC Lauren Conrad, Nine West, and Simply Vera Vera Wang.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Market Dynamics of Heavily Shorted Stocks
- Attraction of Shorted Stocks: LCID stock has become a target for heavy shorting as many experienced traders and institutional investors believe the company's fundamentals are overvalued, reflecting a pessimistic outlook on its future performance.
- Short Selling Mechanics: Short sellers bet on significant risks facing the company, such as poor earnings or industry headwinds, which may lead to a decline in stock price, thus garnering attention for short-selling strategies in the market.
- Short Squeeze Dynamics: When a stock's price unexpectedly rises, short sellers are forced to buy back shares to cover their positions, creating a surge in demand that further drives up the price, resulting in a feedback loop that can lead to explosive gains in a short time frame.
- Most Shorted Stocks List: As of February 13, the most heavily shorted stocks include companies with market caps above $2 billion and free floats exceeding 5 million shares, with short interest serving as a barometer of market sentiment.
See More
Small-Cap Stocks Surge, Outperforming Large-Caps in 2026
- Small-Cap Outperformance: Year-to-date in 2026, the iShares Core S&P Small-Cap ETF (IJR) has surged 10.9%, significantly outperforming the SPDR S&P 500 ETF Trust (SPY), which only rose 1.4%, indicating a potential shift in investor sentiment towards small-cap stocks after years of underperformance.
- Leading Stocks: Kohl's (KSS) tops the list with an 18.49% price percentage above the 200-day simple moving average (200DSMA), followed closely by Newegg Commerce (NEGG) and LGI Homes (LGIH), suggesting strong performance in the consumer discretionary sector that could drive increased investment interest in these industries.
- Divergent Ratings: Among the top performers, Revolve Group (RVLV) and Pursuit Attractions (PRSU) have received Buy ratings, while Kohl's (KSS) and G-III Apparel Group (GIII) maintain Hold ratings, reflecting varying levels of market confidence that may influence investor decisions.
- Market Dynamics: The robust performance of consumer discretionary stocks contrasts with stagnating retail sales, indicating that despite broader economic challenges, specific small-cap stocks continue to attract investor attention, potentially signaling a shift in market dynamics.
See More
Market Analysis of Heavily Shorted Stocks
- Attraction of Shorted Stocks: Investors maintain high short interest in overvalued stocks, indicating significant perceived risks such as poor earnings or industry headwinds that could drive prices down, impacting market sentiment and investment strategies.
- Bear vs. Bull Dynamics: Short sellers meticulously identify companies they view as ticking time bombs, while retail traders see high short interest as a potential springboard for price rebounds, where rising stock prices can trigger short squeezes, affecting market liquidity.
- Understanding Short Squeeze Mechanics: A short squeeze creates a volatile feedback loop initiated by unexpected price increases, forcing short sellers to buy back shares to cover positions, which spikes demand and further elevates prices, trapping more short sellers and potentially leading to outsized returns.
- Current Market Landscape: As of February 2, the most shorted stocks include those with market caps above $2 billion and free floats exceeding 5 million shares, ranked by short interest, highlighting the market's focus on these stocks and their associated risks.
See More
Rise of Retail Investors and Tesla's Dominance
- Rise of Retail Investors: Five years ago, the meme stock craze initiated by retail investors, particularly through the short squeeze of GameStop, became a pivotal event in modern market history, reshaping trading dynamics.
- Tesla's Market Position: In 2023, Tesla surpassed the SPDR S&P 500 ETF to become the most purchased stock by retail investors, reflecting its skyrocketing popularity among small-scale investors, having not even made the top 20 four years prior.
- Performance Comparison: Tesla's shares more than doubled in 2023, while the Nasdaq Composite only gained 43%, highlighting Tesla's robust recovery and the intense market focus on its performance.
- Influence of Retail Investors: Blackrock estimates that retail investors now account for nearly 20% of average daily flows, a significant increase from low single-digit percentages before the pandemic, underscoring their growing impact on the market.
See More
Oversold Stocks in Consumer Discretionary Sector Present Buying Opportunities
- Oversold Stock Overview: Kohls Corp's relative strength index (RSI) stands at 29.6, indicating a 17% decline over the past month and a 52-week low of $6.04, suggesting it is undervalued and may attract investor interest.
- Analyst Rating: Jefferies analyst Blake Anderson assigned a Hold rating to Kohl's on January 14, and despite the stock's decline, the rating may provide a relatively stable investment signal for investors.
- Market Performance: Kohls shares fell 3.2% to close at $17.22 on Wednesday, and with an 86.20 momentum score and a 96.75 value score, it indicates potential rebound opportunities in the market.
- Industry Dynamics: As consumer spending gradually recovers, oversold stocks like Kohls may become focal points for investors to reassess, especially in the context of economic recovery, which could yield higher returns.
See More
Kohl's Dividend and Options Trading Analysis
- Dividend Yield Analysis: Kohl's Corp. has a recent dividend yield of 2.9%, based on historical profitability trends, indicating that the sustainability of future dividends requires careful assessment to avoid misleading investors.
- Historical Volatility Assessment: With a trailing twelve-month volatility of 95%, Kohl's high volatility suggests that investors should consider potential risks when trading options, particularly with covered calls at the $27.50 strike, which may forfeit upside beyond that price.
- Options Market Dynamics: As of Wednesday afternoon, the put volume among S&P 500 components was 858,771 contracts, while call volume reached 1.86M, resulting in a put:call ratio of 0.46, indicating a strong preference for calls, reflecting investor optimism about future price increases.
- Options Trading Strategy Advice: By combining Kohl's historical trading data with current options market dynamics, investors should weigh potential rewards against risks when considering selling covered calls at the $27.50 strike to make more informed investment decisions.
See More
Market Dynamics of Heavily Shorted Stocks
- Attraction of Shorted Stocks: LCID stock has become a target for heavy shorting as many experienced traders and institutional investors believe the company's fundamentals are overvalued, reflecting a pessimistic outlook on its future performance.
- Short Selling Mechanics: Short sellers bet on significant risks facing the company, such as poor earnings or industry headwinds, which may lead to a decline in stock price, thus garnering attention for short-selling strategies in the market.
- Short Squeeze Dynamics: When a stock's price unexpectedly rises, short sellers are forced to buy back shares to cover their positions, creating a surge in demand that further drives up the price, resulting in a feedback loop that can lead to explosive gains in a short time frame.
- Most Shorted Stocks List: As of February 13, the most heavily shorted stocks include companies with market caps above $2 billion and free floats exceeding 5 million shares, with short interest serving as a barometer of market sentiment.
See More
Small-Cap Stocks Surge, Outperforming Large-Caps in 2026
- Small-Cap Outperformance: Year-to-date in 2026, the iShares Core S&P Small-Cap ETF (IJR) has surged 10.9%, significantly outperforming the SPDR S&P 500 ETF Trust (SPY), which only rose 1.4%, indicating a potential shift in investor sentiment towards small-cap stocks after years of underperformance.
- Leading Stocks: Kohl's (KSS) tops the list with an 18.49% price percentage above the 200-day simple moving average (200DSMA), followed closely by Newegg Commerce (NEGG) and LGI Homes (LGIH), suggesting strong performance in the consumer discretionary sector that could drive increased investment interest in these industries.
- Divergent Ratings: Among the top performers, Revolve Group (RVLV) and Pursuit Attractions (PRSU) have received Buy ratings, while Kohl's (KSS) and G-III Apparel Group (GIII) maintain Hold ratings, reflecting varying levels of market confidence that may influence investor decisions.
- Market Dynamics: The robust performance of consumer discretionary stocks contrasts with stagnating retail sales, indicating that despite broader economic challenges, specific small-cap stocks continue to attract investor attention, potentially signaling a shift in market dynamics.
See More
Market Analysis of Heavily Shorted Stocks
- Attraction of Shorted Stocks: Investors maintain high short interest in overvalued stocks, indicating significant perceived risks such as poor earnings or industry headwinds that could drive prices down, impacting market sentiment and investment strategies.
- Bear vs. Bull Dynamics: Short sellers meticulously identify companies they view as ticking time bombs, while retail traders see high short interest as a potential springboard for price rebounds, where rising stock prices can trigger short squeezes, affecting market liquidity.
- Understanding Short Squeeze Mechanics: A short squeeze creates a volatile feedback loop initiated by unexpected price increases, forcing short sellers to buy back shares to cover positions, which spikes demand and further elevates prices, trapping more short sellers and potentially leading to outsized returns.
- Current Market Landscape: As of February 2, the most shorted stocks include those with market caps above $2 billion and free floats exceeding 5 million shares, ranked by short interest, highlighting the market's focus on these stocks and their associated risks.
See More
Rise of Retail Investors and Tesla's Dominance
- Rise of Retail Investors: Five years ago, the meme stock craze initiated by retail investors, particularly through the short squeeze of GameStop, became a pivotal event in modern market history, reshaping trading dynamics.
- Tesla's Market Position: In 2023, Tesla surpassed the SPDR S&P 500 ETF to become the most purchased stock by retail investors, reflecting its skyrocketing popularity among small-scale investors, having not even made the top 20 four years prior.
- Performance Comparison: Tesla's shares more than doubled in 2023, while the Nasdaq Composite only gained 43%, highlighting Tesla's robust recovery and the intense market focus on its performance.
- Influence of Retail Investors: Blackrock estimates that retail investors now account for nearly 20% of average daily flows, a significant increase from low single-digit percentages before the pandemic, underscoring their growing impact on the market.
See More
Oversold Stocks in Consumer Discretionary Sector Present Buying Opportunities
- Oversold Stock Overview: Kohls Corp's relative strength index (RSI) stands at 29.6, indicating a 17% decline over the past month and a 52-week low of $6.04, suggesting it is undervalued and may attract investor interest.
- Analyst Rating: Jefferies analyst Blake Anderson assigned a Hold rating to Kohl's on January 14, and despite the stock's decline, the rating may provide a relatively stable investment signal for investors.
- Market Performance: Kohls shares fell 3.2% to close at $17.22 on Wednesday, and with an 86.20 momentum score and a 96.75 value score, it indicates potential rebound opportunities in the market.
- Industry Dynamics: As consumer spending gradually recovers, oversold stocks like Kohls may become focal points for investors to reassess, especially in the context of economic recovery, which could yield higher returns.
See More
Kohl's Dividend and Options Trading Analysis
- Dividend Yield Analysis: Kohl's Corp. has a recent dividend yield of 2.9%, based on historical profitability trends, indicating that the sustainability of future dividends requires careful assessment to avoid misleading investors.
- Historical Volatility Assessment: With a trailing twelve-month volatility of 95%, Kohl's high volatility suggests that investors should consider potential risks when trading options, particularly with covered calls at the $27.50 strike, which may forfeit upside beyond that price.
- Options Market Dynamics: As of Wednesday afternoon, the put volume among S&P 500 components was 858,771 contracts, while call volume reached 1.86M, resulting in a put:call ratio of 0.46, indicating a strong preference for calls, reflecting investor optimism about future price increases.
- Options Trading Strategy Advice: By combining Kohl's historical trading data with current options market dynamics, investors should weigh potential rewards against risks when considering selling covered calls at the $27.50 strike to make more informed investment decisions.
See More
