Question: What Happens To Stock During Bankruptcy?
March 11, 2019
“…most companies (if given the choice) prefer Chapter 11 to other bankruptcy provisions such as Chapter 7 and Chapter 13, which cease company operations and lead to the total liquidation of assets to creditors. Filing for Chapter 11 gives companies one last opportunity to be successful…
…a company traded at $50 may trade at $2 per share due to bankruptcy speculation. If Chapter 11 is actually filed, the stock price may fall to 10 cents…”
https://www.investopedia.com/ask/answers/10/stock-holder-lose-equity-chapter-11.asp
“Unfortunately, in the event of a bankruptcy restructuring, common shareholders are last in line when it comes to claiming a company’s assets…
Secured creditors (usually banks) get paid back first, followed by unsecured creditors such as bondholders. If a company has preferred stockholders, they are next in the priority line after bondholders…
What happens to the stock?
The short answer is that most of the time, the stock of a company in Chapter 11 becomes worthless and shareholders get completely wiped out…”
https://www.fool.com/knowledge-center/what-happens-to-stock-prices-after-exiting-bankrup.aspx
There you have it. If A company is going bankrupt run for the hills. From what I understand it’s a losing battle.