Why Lumen Technologies Stock Surged 27% in January

Shares of Lumen Technologies (NYSE: LUMN) surged 27% last month, according to data provided by S&P Global Market Intelligence. The beaten-down wireline telecom operator got a boost as heavily shorted deep-value stocks surged amid a retail investor campaign to squeeze short-sellers during January. Additionally, Lumen continued its refinancing campaign that will lower its interest expense going forward and lessen its debt burden.

Lumen was never as heavily shorted as some of the other highfliers during the month, but its short interest did hover around 10% of shares outstanding as of mid-January. Still, one common theme among the short-squeeze candidates is that most were quite cheap indeed coming into the year. A brief and violent rotation to deep-value stocks helped Lumen, which traded for less than four times free cash flow at the beginning of the month.