Wall Street apparently thinks the end is near for Sears Holdings.
The embattled retailer, which faces mounting losses and a $134 million debt payment Monday, saw its shares fall 16 percent in premarket trading Thursday to 41 cents.
The stock (SHLD) fell nearly 17 percent Wednesday on the news the company had not been able to work out a deal with CEO and largest shareholder Eddie Lampert to restructure its debts and sell more assets.
Rather than restructure the business, Sears may liquidate its assets in a chapter 7 bankruptcy filing, a plan supported by major lenders including Bank of America Corp., Wells Fargo & Co. and Citigroup Inc., according to The Wall Street Journal.
A Chapter 11 bankruptcy filing would allow Sears to cut debt and close more stores in an attempt to possibly survive as a smaller, profitable company.
That leaves Sears as "a firm without any real inherent value," said Neil Saunders, managing director of GlobalData Retail. "The prognosis is gloomy, just as it has been for many years. Over this time Sears has been expert in restructuring and playing for time with various financial machinations. However, at some point, the music has to stop. We believe that time is now."
Sears Holdings met with its lenders Wednesday night but did not reach an agreement that would keep Sears operating, one of the persons involved told the Journal.
Sears shares have fallen 88 percent so far this year, as the company has closed more stores and cut costs. But some of the challenges of the retail business – including growing digital sales – has particularly hit Sears hard as it failed to invest in stores and e-commerce.
The retailer has closed several hundred stores in recent years, but still operates 506 Sears locations, including 482 full-line department stores, and 360 Kmart stores, according to an Aug. 4 public filing.
Lampert has approved hundreds of store closures and massive cost cuts to give Sears a lifeline despite the retailer's declining sales. But in a letter last month, he said Sears "must act immediately" on his latest proposal, in his investment capacity, to sell more assets and shed debt.
As part of his proposal, Lampert would buy the Kenmore house appliances brand from Sears for $400 million.
Contributing: Nathan Bomey.
Follow USA TODAY reporter Mike Snider on Twitter: @MikeSnider.