The stock market had some inkling that American Airlines (AMR) might file for bankruptcy protection. Its stock price meandered down from roughly $9 in early 2011 to less than $2 by the time it filed for Chapter 11 protection on November 29, 2011.
Wall Street equity analysts didn't get the message. Despite rumors in early October that the company could file for Chapter 11 soon, every firm with a rating on parent company AMR still had the stock at buy or hold.
Just a few days before the company filed, Morgan Stanley issued a report citing the stock's value at $6 a share. Barclays and Deutsche Bank also had buy ratings on the stock ahead of its filing. The day it declared bankruptcy, AMR's shares dropped 84% to close at 26 cents.
