Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
No, people need to read this. This plays out over and over again, and certain people never learn or being intentionally deceptive to try and con newbies. The success of retailers exiting bankruptcy with equity intact over the past several decades is zero. Even surviving at all is near zero. Just look at all of the major brands that have vanished just in the last decade. My guess is JCP in its new form will be gone in a year or two.
Challenged by the EC? They have no standing. Unsecured creditors are getting nothing, equity is far behind them in line. They can cry all they want, but they can't magically conjure up $5 billion in actual assets.
I've seen this with a couple of stocks. Kodak, Dendreon , Radio Shack. Dendreon might have been the worst. Three years later and some of the delusional diehards were still claiming they would be paid for their shares. Several of them claimed they would refuse to take the tax loss as a protest. Yeah, that will mean absolutely zero.
I really don't understand some of the 'logic' here, if you could even call it that. If lien holders who are four or five places in front of you are getting nothing, why would shareholders receive even a 100th of a penny? This is basic bankruptcy law stuff. There is no mystery here. Unless someone is insane and pays off all of the debt by buying the company whole there is no hope here for commons.
Must be nice to have have $20k or so to simply flush down the toilet. This might get a dead cat bounce when the sale is approved, as idiots will read "Penny's sale approved" and flock to the stock, but it will likely not reach previous highs. Sears did the same thing but the sale bounce was only 10-20 cents compared to the initial $2 run.
And you shouldn't. But ignoring a POR submitted to the court isn't wise either. This isn't some random filing by an angry investor. This is the legal path going forward barring some extreme miracle. Considering the retail situation is likely to get worse this Christmas with COVID spiking everywhere it doesn't look like Santa is bring a $8 billion buy out.
Losing all of your money is fun? Considering the positive outcome long term for penny stocks is near zero that is not a very wise strategy. The POR was filed today and clearly states what is going to happen. A white knight is not coming to save the day. Bond holders might get a better deal in the end, but commons are so far in the back of the line that they will not even get to sniff the cash.
Did any of you actually read this filing? It looks like it was written by one of the pumpers on this board. I could file a claim that I'm the King of England, doesn't mean it will hold water. But damn logic and the law. I claim that JCPNQ will be purchased by Amazon for $1000 per share. You just need to read between the lines of the lines and see all of that value.
I'm amazed the usual suspects are not here pumping this. Reality usually means nothing to them. The fact that this still trades in the 10-20 cent range is amazing. The company states months ago that they were liquidating and shut down all operations, yet people trade this daily. Once again the SEC shows why it is complete joke. They'll go after grandma for trading 10 shares on a tip, but ignore massive manipulation and pump & dump schemes without blinking an eye.
WAMU is not retail. Only about 4% of bankruptcies see any sort of equity surviving. Also, WAMU was not some big win for shareholders. Maybe if you bought at 2 pennies or whatever it was at the low. Consider it was at around $5 a share when it was basically taken over by the government that is nothing to cheer about.
That's not how bankruptcy works. How do you think they "shed the fat"? Owners don't just get to default and walk away like nothing happened. There is a reason it is called "secured debt". Very few companies survive bankruptcy with equity enact. In the case of retail that number is zero, at least in the past three decades.
What misinformation? Do you not understand how bankruptcy works? There are multiple classes, with shareholders being dead last. Unless every single class in front of them is made whole 100%, shareholders get nothing. This is not a guess, or an opinion. That is the law. Every single penny of debt will have to be made whole before shareholder see anything. That number is currently over $5 billion. People here keep talking about "valuation". None of that means bubkus. The only thing that matters is that creditors get made whole.
Yeah, an article from the end of May is a real find. Maybe someone can dig up a Penny's Holiday catalog for some really pumper action.
I'm sure that is where you will be crawling when this goes poof in a year or two. It's the same game every single time and it ends the same way every single time. Funny though, the most vocal and obnoxious pumpers are never to be seen again when reality finally hits.
BTW, your family history has nothing to do with bankruptcy law and the order of claims. The fact that you think it has some relevance speaks volumes.
Yes, if a lot of people don't actually read anything about the bid. From the Bloomberg article:
"Shareholders wouldn’t likely receive any recovery on their claims even in the event of a higher bid, as the company would have to first repay about $5 billion in debt before value could flow to equity holders."
That has nothing to do with shareholders. JCPNQ will live on just fine without them.
"with this buyout happening behind the $JCPNQ scenes". This same post has literally been made for every bankrupt company for the last 20 years. The only people being played here are the ones thinking they going to be rich by buying and holding. Don't believe me? Go look at the boards on this very site at the grave yard of bankrupt companies. The play is the same every time, and the marks fall for it every time.
The EU has to approve the asset sale of a US company with no EU operations in a US bankruptcy court? On what planet?
BLOAQ/BLIAQ. Halted when Dish bought the assets of Blockbuster.
The number of times a retailer has emerged from bankruptcy with existing shares intact? ZERO. Playing dead cat bounces? Risky. Going long on a bankrupt retailer? Suicidal.
You do realize that this case is in Federal court, right? A state AG has virtually no standing. As for the EC, I suggest you research what happened in the Kodak case. The bar is high for outside valuation claims. Unless the EC is willing to put up several billion in bond money to match the current bid offer I doubt it will go very far.
Five and Six have nothing to do at all with the court and is purely your fantasy. No one has shown any interest in buying JCP as a whole before or during the bankruptcy. The valuations you're trying to claim are no better than Enron's mark to market accounting tricks. An asset's value is what someone is will to pay for it, not what some equity expert claims it is.
This is a important concept that most shareholders fail to grasp. Any potential buyer literally does not give a **** about shareholders. They want to get as many assets as possible for as little money as possible. If JCP was such a valuable asset someone would have purchased them before a world wide pandemic destroyed what was left of retail. This company was a walking corpse 10 years ago. Not even blowing away 100% of the debt is going to save it. Once a death spiral starts in retail it almost never reverses.
Are you serious? They lost almost $400 million this quarter. In what variation of common core math does that come out to a positive EPS? I really want to hear this explanation as maybe you are in line of a Nobel prize for discovering a new form of economics. Here is a hint. The parenthesis around a number means it is a negative.
What? They lost $398 million. There are no earning per share. They lost money per share.
So what is JCPNQ's new business? They sold all of their assets via a 363 sale. So what is bring in all of this revenue? Also, how does the debt disappear? Sale price didn't even come close to covering.
These posts just baffle me, yet it is the same every time. The law is clear, creditors and lien holders must be made whole before shareholders see a dime. This is not up to the judges feelings or some lawyers convincing argument. That is the law.
Just remember that this is not a long term play. Ride the nice dead cat bounce this will get and know when to get out.
Do you care to revise your statement?
Oh man, these are my favorite stock board days. I can't wait to see what while claims will be made. Kind of like "It's worth $44 a share" on the Sears board.
This stock no longer has anything to do with Sears. The assets were sold at auction to ESL. What is left of SHLDQ is being liquidated as we speak.
Long term it doesn't, as that means the there is nothing left of the company. But in the short term ignorant investors tend jump on board as they thing the "company" is being sold and that they're going to get part of that. In reality the assets are transferred and stock holders are left holding a debt ridden corporate shell.
If you had already been holding then I agree, no reason to sell. Hell, I bought in at around $3 a share. My biggest loss since WAMU. I just don't think this will see a Sears like dead cat bounce. First off, it is not a house hold name. Second, the media made that happen with their poor reporting of Sears "Exiting bankruptcy" and conflating the new Sears with the old stock. If a 363 does occur here this might get a nice bounce for a couple of days.
Do actually understand how bankruptcy works? The company has basically been taken over by creditors. That is not a good thing. It's like claiming your house is worth more now that the bank has foreclosed on it. It is the same BS every time on these boards.
I'll never understand how companies are legally allowed to operate like this in chapter 11. Sears bought goods and services from suppliers with no intention of paying them for it. As soon as the 363 sale happened the case should have converted to chapter 7 instead of letting criminals milk the remaining carcass for as much as they can.
This is really odd, as the link you posted directly contradicts the actual title of the article. The link is
https://seekingalpha.com/article/4294366-sears-holdings-pot-gold-waiting-end
yet the actual article is
"Sears Holdings: No Pot Of Gold Waiting At The End".
I wonder how many people bought simply by looking at the URL.
This answers both of your question, the NOL part, and the "and the claiming of a worthless stock deduction by any 50-percent shareholder of Sears Holdings, within the meaning of section 382". There is no "negotiation with shareholders". Shareholders are dead last in line to get paid. You posted about being "made whole", do you even know what those words mean legally? But don't let me deter you. Buy as much SHLDQ as you can tomorrow, as it will be your last chance. Special folks like you deserve a rich reward in life.
Here it is buddy boy. Of course, you already knew this existed, didn't you? Oh, and don't worry about that 382 section, as Eddie was a majority owner of SHLDQ.
insert-text-here
"A. Consequences to the Debtors
Each of the Debtors is a member of an affiliated group of corporations that files a consolidated federal income tax return with Sears Holdings as the common parent (the “SHC Tax Group”) or an entity disregarded as separate from its owner for U.S. federal income tax purposes whose business activities and operations are reflected on the consolidated U.S. federal income tax returns of the SHC Tax Group. The Debtors estimate that, as of the Commencement Date, the SHC Tax Group had consolidated net operating losses (“NOLs”) of approximately $6 billion, among other tax attributes (including tax basis in assets). However, in accordance with the Asset Purchase Agreement, a substantial portion of such NOLs and certain of their other tax attributes are expected to be transferred to Transform as a result of the Sale Transaction (in combination with the subsequent liquidation of the Debtors) qualifying as one or more reorganizations for U.S. federal income tax purposes, subject to reduction with respect to any item of cancellation of debt (“COD”) incurred by such Debtors in the taxable year of the Sale Transaction or afterwards. The Debtors expect to incur certain additional losses in connection with the implementation of the Plan.
The SHC Tax Group’s ability to utilize its NOLs and certain other tax attributes could be subject to limitation if the SHC Tax Group underwent or were to undergo an ownership change within the meaning of section 382 of the Tax Code after the Commencement Date. Accordingly, the Debtors obtained a Bankruptcy Court order, effective as of the Commencement Date, imposing certain restrictions with respect to trading in Sears Holdings stock (and the claiming of a worthless stock deduction by any 50-percent shareholder of Sears Holdings, within the meaning of section 382) so as to avoid such an ownership change. The Debtors believe that no ownership change of the SHC Tax Group for section 382 purposes has occurred to date and expect that no such ownership change will occur prior to the liquidation of the Debtors as of the Effective Date.
The amount of any NOLs and other tax attributes, as well as the application of any limitations, remain subject to review and adjustment by the IRS"
So the SEC and the courts are both lying when they stated unequivocally that the NOLs were transferred to the new Sears, and you, Mr Anonymous message board poster, are tell the truth?
Reversal of what? The bankruptcy is not going to be undone. SHLDQ has billions of debt. Nothing is making that suddenly go away and the judge simply follows the bankruptcy laws.