Target Corporation (TGT) reports earnings tomorrow. Its stock stayed flat this week, but short interest jumped 11.5%. Historically, more short interest means the stock may drop. Options show an expected 8% move, with a bigger downward tilt than usual, pointing to a bearish outlook.

TGT reports earnings tomorrow before the market close.

TGT stock has remained unchanged this week leading up to earnings, which doesn’t provide a clear indication of stock movement.

On the other hand, short interest has increased by 11.5% this week.

Historically, the stock tends to move in the opposite direction of short interest, suggesting that short sellers are often correct.

The stock typically moves 8% on earnings, either up or down, with options pricing already reflecting this expected movement. However, the forecasted move down seems larger than usual.

TGT has seen a rise in short interest as the stock continues to decline, following a momentum strategy.

The pronounced increase in Target Corporation (TGT) short interest, up 11.5% this week, aligns with historical trends of inverse stock movement pre-earnings. With options pricing reflecting an amplified downward bias within the typical 8% earnings shift, evidence strongly supports a bearish stance ahead of tomorrow’s report.

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