Value

• The company's stock price drops significantly when it files for bankruptcy. This can lead to the company delisting from a stock exchange, which can cause the value of the stock to drop even further.
  
  

New Stock Issue

• Sometimes a company will file for bankruptcy and issue new stock. Unfortunately, this doesn't mean the company will exchange its old shares for its new issues. If this is the case, any stocks issued prior to the bankruptcy filing are of no value.
  
  

Asset Sale

• When a company files for bankruptcy, it usually sells off some of its assets in order to pay off or pay down its outstanding debt. Proceeds from the assets first go to pay off government debt. Next, they pay off creditors and bondholders. After taking care of those debts, the company will pay preferred shareholders and lastly common shareholders if there is any money left from the sale of assets.