I have been reading many topics on this forum and it seems like there are many misinformed "investors" out there. So many replies to topics about bankruptcy. Let's do some basics.
Definition of Bankruptcy: the state of being bankrupt.
Using it in a sentence: "many companies were facing bankruptcy"
Definition of Bankrupt: A debtor that, upon voluntary petition or one invoked by the debtor's creditors, is judged legally insolvent. The debtor's remaining property is then administered for the creditors or is distributed among them.
In layman's terms: (of a person or organization) declared in law unable to pay outstanding debts.
Vical has no debt. They can not go bankrupt. They can be bought out with a LBO as in the case study of Nabisco.
Please, for the love of finance and all that is holy in finance, stop using this term carelessly.
Do you really think that those who speak about a bankruptcy are honest? It's very common in these boards to scream "bankruptcy" when you are a shorter or you want to buy lower, in a try to mislead any newcomers.
To say that Vical cannot go bankrupt is very naïve. They won't file bankruptcy in the next couple months, but if their next trial isn't a winner, you can bet your last dollar investors will head for the hills.
You are absolutely correct. They will not go bankrupt any time soon. They have predicted their cash flows to last for at least another 1 year. Many people here make it sound like they are closing the doors tomorrow.