Q: Hi, I have shares in Peabody energy which filed chapter 11 earlier in the year. Once listed with the "Q" designation, the shares lingered in the $1.50 range for about six months until the past week where they sky rocketed to what it is currently at $13.50.
Do you have an idea what machinations cause a ch11 stock to go this high? Also should I take advantage of this pop and sell my existing shares?
I read that once a ch11 company climbs out of bankruptcy they can issue new shares making existing common shares worthless. Is it possible that peabody may not do this?
Sorry for the barrage of questions, I am very curious how bankruptcies work.
Thank You,
Andrew
Do you have an idea what machinations cause a ch11 stock to go this high? Also should I take advantage of this pop and sell my existing shares?
I read that once a ch11 company climbs out of bankruptcy they can issue new shares making existing common shares worthless. Is it possible that peabody may not do this?
Sorry for the barrage of questions, I am very curious how bankruptcies work.
Thank You,
Andrew