What happened

Shares of Sears Holding Corp. (NASDAQOTH:SHLDQ) were getting hammered again today after the company acknowledged that it is at risk of bankruptcy, calling itself a "going concern" in its 10-K filing. As of 11:03 a.m. EDT, the stock was down 13.9%.

An exterior shot of a Sears store

Image source: The Motley Fool.

So what 

In its annual report filed with the Securities and Exchange Commission, Sears said, "Our historical operating results indicate substantial doubt exists related to the Company's ability to continue as a going concern." It was a staggering admission by a company that was the No. 1 retailer in the country just a generation ago, and the first time it has formally admitted that it may not survive.

Sears, which also owns Kmart, has put up operating losses since 2011, and has seen comparable sales dwindle since then as it's been the victim of self-inflicted errors and the general decline in department store retail. During that time, Sears has sold off a number of brands including Lands' End and Craftsman, and has also shifted some of its stores into a real estate investment trust. While those moves have freed up cash, they have not solved the the underlying problem of the company's poorly performing stores.

Now what

Sears' admission may have been a surprising dose of reality, but it does little to shore up hopes for investors. The writing has been on the wall for a long time with Sears. At this point, bankruptcy is only a matter of time.