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"Although we cannot predict how our common stock will be treated under a plan, we expect that common stock holders would not receive a recovery through any plan
by wjnc 6y ago
"Although we cannot predict how our common stock will be treated under a plan, we expect that common stock holders would not receive a recovery through any plan unless the holders of more senior claims and interests, such as secured and unsecured indebtedness (which is currently trading at a significant discount), are paid in full, which would require a significant and rapid and currently unanticipated improvement in business conditions to pre-COVID-19 or close to pre-COVID-19 levels."
You will lose all your money unless there is an unanticipated improvement in business condition! I love how you just can't bullshit in your SEC-filings.
- deleted 6y ago[deleted]
- varjag 6y agoNot that far from Uber IPO filing tbh.
- collyw 6y agoI would be happy for Airbnb And Uber both to go.
- arbuge 6y agoThey know very well that the kind of people who read these filings are not the same kind of people eagerly buying their stock at this point.
- SilasX 6y agoYeah, they’re nothing like the sophisticated, mature investors that are buying 30-year government bonds that probably won’t even keep up with inflation. To phrase less trollishly: there aren’t a lot of good investments now, and even government bonds seem overvalued.
- H8crilA 6y agoThat's called "financial repression". Sorry that it causes you to take excessive risks, there are many like you. Walter Bagehot, the de facto founder of The Economist, was of the opinion that people will never stand 2% rates (and he meant plus :) ). They would rather fund anything, any project, the weirdest thing that offers any hope of yield; no matter how stupid. And here we are, 143 years after Bagehot passed away. Sir, you are still absolutely correct!
- toomuchtodo 6y agoWouldn’t it be more accurate to call it “financial entitlement”, to believe that your capital would always have positive value? While we’ll likely never run out of need for human labor, it’s very possible we’re running out of capital investment opportunities that realize a risk adjusted return above 0. “Too much money chasing too few deals” and all that jazz.
- H8crilA 6y agoI totally agree that growth and gains on capital are not a given, but: 1) The world's real GDP is still going up. Or at least has been till 2019. 2) Even if it was to slow down and remove prospects of gains on capital - it still doesn't mean that people will adjust quickly; you'd have to rewrite the entire concept of pensions for starters. 3) It seems to me that core rates are seriously manipulated down (interest rates, default spreads, equity discount rates); just look at ballooning of the balance sheets of pretty much everything, or look at the share of "zombie" companies, that is companies that cannot even service their interest payments. 3 is of course just an opinion, but if true will result in serious clogging of the machine with useless actors. 3 is where, I believe, things like "bullshit jobs" / "the office" come from, for example.
- toomuchtodo 6y agoAgree with your points, hard to know what the future looks like but it’s clear it’s not going to look like the past.
- yamoriyamori 6y agoThis, the Hertz management know there's a huge disparity of knowledge/wisdom in the market and taking full advantage. SEC filings/proceedings as the regulation dictates (though it can seem tongue in cheek in the specific language), but on the other end are all the Robinhood accounts ready to 'invest' from the convenience of their respective mobile phones, enabled by a ridiculously low number of clicks/taps to open an account.
- pbreit 6y agoThere will be plenty of (legitimate) lawsuits if equity holders take a loss here.
- gruez 6y agowhy? AFAIK since they're in bankruptcy, they have zero obligation to shareholders, only to creditors.
- pbreit 6y agoBut they are doing an equity offering? Got it.
- camjohnson26 6y agoTheir shares irrationally have value on the market, issuing equity allows them to pay off more of their debts. Why shouldn’t they issue, it’s the company’s job to release accurate information, not to force the buyers to make wise decisions. If someone offers you millions of dollars for your totaled car you’d be a fool not to take it, this is no different. Hertz management must be loving this.
- pbreit 6y agoIf the company knows stock purchasers are making a bad decision it would be obvious negligence.
- pmiller2 6y agoOnly if they don't disclose the serious risks involved, which they do, right up front in the very first few sentences of the filing.
- RobRivera 6y agono, every broker has a lovely warning about the nature of sec regulations and financial instruments risk of losing value. Negligence is in the investors lack of due diligence. Its why publicly traded companies must publish financials and why cooking the books is illegal and fraudulent
- deleted 6y ago[deleted]
- CalChris 6y agoDebt is senior to equity.
- beervirus 6y agoRobinhood traders buying anyway, what can you do.
- koolba 6y agoThe intersection of buying their stock this past week and people who read SEC filings rounds down to zero.
- deleted 6y ago[deleted]
- nogabebop23 6y agoSweet potato pie! Read the entire "Risks" section it goes something like this: Smithers: What would each of you say is your worst quality? Man 1: Well, I a workaholic. Man 2: I push myself too hard. Hertz: Well, it takes me a long time to learn anything, I'm kind of a goof-off... Smithers: Okay, that'll do. Hertz: ... a little stuff starts disappearing from the workplace... Smithers: That's enough!
- 3327 6y agoYou cannot make tendies day if you read the fillings.
- perl4ever 6y agoI find this disturbing, a corruption of the system, despite the disclosure, and despite that I personally like to read SEC filings. Just telling people something is a scam is not enough, when the action of allowing it to go on implies that it must not be. It's like, suppose you go to the hardware store and you buy a rake. And on it there is a label with the standard warning "this contains substances known to the state of California to cause cancer, etc.". So you buy it, take it home, and a month later you die horribly because it was radioactive or something. You can argue about the percentage of guilt that accrues to the manufacturer, the store, the California lawmakers, etc. But it's not right to blame the victim, because when people get conflicting information, they have to disregard some of it, and you can't consistently go against the herd in such situations. It's necessary to have a level of trust that underpins the explicit language and gaming of rules that people engage in. I know not to buy stock in bankrupt companies, but I don't think I'd be as dumb as the stereotype of Robinhood investors if I was naive enough to think, "well, they say it's worthless, but if the SEC allows it, it must not be a complete scam" and bought it anyway.
- pmiller2 6y agoYour rake analogy is a little flawed, just because those "known to the state of California...." warning signs are practically everywhere. If they were actually rare, and this rake was the only thing in the store that had the sign, and the store was requiring a liability waiver to buy one, then you'd have a much closer analogy. In that scenario, given the multiple warning signs (including an actual, literal warning sign), I do think it's fair to say the purchaser holds some blame for being a dumbass. The legal system might say otherwise, but, if you do something that you've been warned multiple times is really, really dumb, by who should know you're about to do a dumb thing, then personal responsibility needs to accrue somewhere.
- perl4ever 6y agoIt's a matter of opinion on how much this warning stands out. I don't think there is going to be a special waiver to buy Hertz stock; the whole point is to be able to go directly to the public in an unrestricted manner. But let's stipulate that in some sense the warning is rare and extreme, that doesn't affect my opinion. If a new Apple laptop came with a warning that violation of a license would result in earth falling into the sun, the severity and rarity wouldn't make you say "gee it really might happen". You might look into whether it was really from Apple, if it was a joke, what other people thought. If millions of other people were buying them, you would assume that it can't happen, because the validation of things people do overrides the warning regardless of severity. Deceiving someone by telling them the truth in a situation where they are conditioned not to believe it is not a trick that somehow transfers responsibility. It's not better than directly telling a lie. It's worse, because it sets people up to believe the next lie after you've proven they were wrong to ignore the truth. It's like, I don't know, cargo cult morality. I wouldn't believe for a minute this is ok to buy because I'm untrusting. But if I trusted the SEC or the laws and concluded this can't be a scam, because it would be illegal otherwise, then it's a mark of corruption and rot in society to punish trust in the system as stupidity or lack of responsibility. The very fact that it is being allowed creates genuine doubt in my mind about who to believe and what's going on, even though I would not make the decision to buy.