Spikes like that are really hard to trade, you know the end result but the difference between making 10x and going to zero is timing. Essentially you have to keep making those high risk timing bets and hope that you get it right often enough to matter. There were probably lots of people that knew Toys R Us was doomed, it was just a matter of when they blew up. Unfortunately if you see that the market isn't reacting at all to the news its really risky to make the bet on failure. If you are an annalist looking at a company that's doing terribly, but at the same time their stock is staying flat or going up there isn't much you can do other than not invest in the company.