Everybody hertz... But Hertz didn't cry when its stock inexplicably soared after its bankruptcy announcement. The airport rental car classic was hurting pre-corona, thanks to competition from peers like Enterprise and ride-hailers. Then came this head-scratching timeline:
Lenders get paid first... The "absolute priority" rule in bankruptcy means that creditors (whom Hertz is indebted to) must get back the money they lent before shareholders get a penny. That's why Hertz had to warn potential buyers of its new stock that they will likely lose all their money.
Investors aren't always rational... So stocks don't always move in sensical ways. People traditionally buy because they believe a company will generate greater cash flows in the future (and so, they believe, share prices will rise). But stocks also rise for reasons unrelated to actual/future value: if there are more buyers than sellers, a stock's price rises. The "buying reason" — whether that's thoughtful investment analysis or straight up speculation — still affects the stock's movement either way.