Wendy's stock is having a moment. Shares of the fast-food chain jumped more than 20% in Wednesday's premarket session, putting it on track for its biggest single-day gain in years. The catalyst? A new executive hire and a wave of retail traders piling into a heavily shorted stock.

A New CFO Sparks Hope

Wendy's named Steve Cirulis as its new chief financial officer and chief strategy officer. Cirulis previously held the same roles at Potbelly Sandwich Works, where he worked alongside Wendy's current CEO, Bob Wright. Investors are betting that this familiar duo can replicate whatever magic they had at Potbelly and turn around Wendy's, which has been struggling with softer consumer spending and declining traffic.

But let's not get carried away. Despite Wednesday's rally, Wendy's shares are still down nearly 50% over the past 12 months. One good day doesn't erase a year of pain.

The Short Squeeze Factor

Here's where it gets interesting. Wendy's has a short float of 50.27 million shares, representing 37% of its publicly traded float. That's a lot of bets against the stock. When shares started climbing on the CFO news, short sellers likely got nervous and started buying back shares to cover their positions, adding fuel to the fire. This classic short-squeeze dynamic amplified the move, and retail traders, always eager to pile on, joined the party.

What's Next for Wendy's?

The next big event for Wendy's is its earnings report, expected on August 7. Analysts are forecasting earnings of 16 cents per share, down from 29 cents a year earlier. Revenue is projected at $559.61 million, compared with $560.93 million last year. Not exactly a growth story.

The stock carries a consensus Hold rating from 24 analysts, with an average price target of $7.95. That's not far from where it's trading now, even after the pop. Recent analyst actions include an Equal-Weight rating from Stephens & Co. with an $8 target on June 23, a Buy from Argus Research with a $12 target on May 13, and a Hold from TD Cowen with a $6 target on May 12. So opinions are all over the map.

As of premarket Wednesday, Wendy's shares were up 20.38% at $7.53. Whether this rally has legs depends on whether the new CFO can actually deliver a turnaround — and whether the short squeeze runs out of steam.