It’s no secret that the retail sector is undergoing a major shift that has left big-box department stores scrambling to keep up with the competition. However the struggles of companies like J C Penny Company Inc (NYSE:JCP) and Macy’s Inc. (NYSE:M) pale in comparison to what Sears Holdings Corp (NASDAQ:SHLD) is up against. Sears is quite literally at the end of its rope. The company’s massive debt load coupled with its failure to make any real progress with its online presence or physical store foot traffic has put it in a terrible position for the future.

Investors should stay far, far away from Sears stock, because the share price is likely heading to zero.

Sears’ Bankruptcy Filing

One of the biggest question marks for SHLD is the firm’s potential to file for bankruptcy in the coming year. The company is bleeding money and it appears to be unable to stem the steady flow of cash out the door.

The past few quarters have seen Sears lose hundreds of thousands of dollars, pushing the firm further and further away from paying off its huge debt mountain, so why hasn’t the company filed yet?

While you can’t be certain about the timeline for Sears’ bankruptcy filing, there’s a pretty good chance it’s coming some time after July 10. The firm’s CEO Eddie Lampert used his hedge fund to buy several dozen Sears stores to form a REIT called Heritage Growth Properties (NYSE:SRG). The move was a conflict of interest for Lampert, and U.S. bankruptcy law says that if Sears were to file within two years of that real estate sale, it could be seen as a way for Lampert to get some of the company’s assets off the books in order to keep creditor’s hands off them.

July 10, 2017 will be exactly two years after Sears sold those stores, so if Lampert is planning to file, it will come in the months after that date has passed.

What About a Revival for SHLD Stock?

While bankruptcy appears to be the most likely outcome for Sears, it’s not the only one. Sears’ eventual demise seems to be obvious to just about everyone except Eddie Lampert. Not only has he essentially been bankrolling Sears over the past few years as the company sinks further and further, but he recently took to the internet to bash some of SHLD’s suppliers — who he said are using the “negative rumors” about Sears’ business to make better deals for themselves.

It’s unclear what’s going through Lampert’s mind and although SHLD stock looks like a lost cause, it’s possible that he thinks he can revive it. Sears recently negotiated an extension for a $500 million loan that was set to come due in July. Now the firm won’t have to pay it back until January.

Sears also annualized more than $500 million of its pension liabilities, drastically reducing the cost of paying pension obligations for some 51,000 retirees.

Both of those actions have bought SHLD some time, but not enough to make a real difference. Even today’s 20% pop on better-than-expected earnings won’t help.

Sears is slowly sinking further and further toward zero, and extending the company’s lifetime by a few months is unlikely to help Lampert’s turnaround efforts. The retail environment is a harsh one, even for the most prepared brick-and-mortar stores. To make matters worse, Sears is in the business of selling appliances, a subsection of the industry that has been incredibly hard hit. Sears doesn’t have the customer base, cash, or competence to make a comeback in the current environment.

When Will It End?

Sears stock is likely to continue dragging lower in the months to come. Lampert may not be willing to admit defeat come July 10 when the firm is able to file for bankruptcy, but investors can expect murmurs that ‘B-day” is coming once that date has passed. That kind of chatter will probably continue to weigh on SHLD stock until the company finally runs out of time and money.

As of this writing, Laura Hoy did not hold a position in any of the aforementioned securities.