Bankruptcy Fears Hammer Delta

Delta Air Lines (DAL Quote) has yet to file for bankruptcy, but its shares are trading as if it has.

The stock slumped again Monday on continuing fears that the nation's No. 3 airline will show up in bankruptcy court. The shares are now firmly in the range that another bankrupt carrier, United Airlines' parent UAL (UALAQ Quote), has recently plied.

If Delta does file for Chapter 11, equity holders will be left holding paper that likely will end up worthless. That's because companies tend to cancel common stock when they emerge from bankruptcy and issue new shares to pay off creditors. ...