The people buying the shares are making the "true" valuation of the company, being the ones buying it.
In this case, the buyers of Hertz stock were most likely wrong, although things are not yet finalized and another comment here notes that alternate plans are being proposed that would not wipe out share holders.
Or do you think, that like most other bankrupt companies, HTZGQ will be worthless once these bankruptcy proceedings are done?
The stock is almost certainly going to go to $0. That's just what happens as bankruptcies play out. If you disagree, you're welcome to toss your money into buying some HTZGQ yourself.
----------
The issue is that Hertz CEOs / board / CFO have extra information and better ideas into how those bankruptcy proceedings are happening. For them to issue shares in this time is grossly immoral. Especially when they're publicly pointing out that yes, bankruptcy proceedings are carrying on as expected: shareholders are expected to be wiped out and assigned a big fat $0.
(I cannot reply to your response when you edit so often... looks like it resets an anti-spam timer or something)
The proceedings behind a deal at this scale are so private that it is rare to see major salient revisions after a public announcement like this. Nevertheless, I concede the point that it isn't completely final. Presumably they'll be de-listed once that actually happens.
https://www.prnewswire.com/news-releases/hertz-global-holdin...
As of a few days ago, the PLAN (not yet executed) is to give Knighthead new shares and wipe out the current set of shareholders.
---------
There is a rival plan to keep HTZGQ shareholders alive. These sorts of plans go back and forth, discussed by the board, the bankruptcy court, and so forth to determine the best course of action.
No plan is ever 100% certain... not until the plan is executed. Still: the current plan is that Knighthead will be the new owners, old shareholders will be wiped out, and old bondholders will get 70%.
If bondholders are only able to get 70% under the current plan, it seems unlikely that any alternatively proposed plan would bring that to 100% somehow (the precondition before old shareholders of HTZGQ to get value out of this...). The plans will change, but the amount of assets that Hertz owns will not change. So I'm not entirely sure where another 500-million buckaroos will come from to make the bondholders whole.
Hertz just cut out the middle men here and sold directly to suckers, maybe a lot of their executives were also creditors.
Can I interest you in an Iraqi Dinar?
May I interest you in some Aaa-rated subprime mortgage backed securities? How about some negative -yield bonds?
Institutions can have conflicts of interest, which individual investors can make up their own mind on. (Whether that's a winning strategy is another question, I admit)
If I sell my broken car while clearly noting that it’s broken, hat makes it ok, not worse than if I’d left it out.
Do you hold this view for sellers of hertz stock that aren’t hertz? What about sellers of stock that bought the stock post bankruptcy?
Then if some idiots think it's not the case, and there is value, let them bet if they so want, they obviously know better than Hertz. Hertz only decided to issue shares when their share price went over the roof, driven by those same speculators.
As long as things are correctly disclosed ("our stock is worthless, but buy it if you want"), caveat emptor.