Battled electronics retailer RadioShack (RSH) started the trading day down 14% on an earnings release that was worse than expected—and let me emphasize that expectations were not high going into the release.

Revenues for the quarter were down 13% year over year, and its $0.97 per share loss was almost double the consensus estimate of a $0.52 per share loss.  Worse, same-store sales—one of the most telling measures of a retailer’s health—dropped a gut-churning 14%.

I’m not going to write another article about how RadioShack is doomed due to competition from big box retailers and the internet—though it most certainly is—or why buying RSH stock is a terrible idea.  I thoroughly beat up RadioShack two years ago when I advised against chasing the 10% dividend that RSH stock was paying at the time.

At least RadioShack management has a good sense of humor.  See “The 80s called; they want their store back.”

Instead, I want to focus on the nuts and bolts of what happens to a stock in RSH’s position.   RSH stock is priced at under $1.50 per share and has traded as low as $1.12 this year.  It’s perilously close to the $1 threshold at which a stock gets delisted from both the Nasdaq and the NYSE.

In order for a listed company to remain listed on the NYSE, certain standards have to be met.  The stock price cannot fall to below $1 over a 30-consecutive-trading-day period.  That’s a simple standard and easy enough to remedy when broken. A company in RadioShack’s position can always do a reverse split, whereby they effectively combine shares.  In such a scenario, RadioShack could, say, issue one new share of stock for every 10 existing shares.

But after the price criteria, there are other valuation criteria that get harder to skirt.  A stock must maintain a market capitalization of at least $50 million over a 30-consecutive-trading-day period (other standards using shareholder equity or revenue can also be used; see  continued listing requirements).

Obviously, major corporate events such as bankruptcy or buyout will also trigger a delisting, as can a failure to file financial statements in a timely manner.  And sometimes, companies simply choose to delist.  For example, German industrial giant Siemens (SIEGY) very recently gave up its NYSE listing and now trades in the over-the-counter market.  Siemens found that it already had sufficient liquidity trading in Europe, and the added benefit of listing in the United States was not worth the added compliance cost.

Also, delisting does not happen immediately.  When a company fails to meet the criteria, they are notified by the exchange and given time to remedy the situation via a reverse split, a secondary offering or some other action.

As of this writing, RSH stock has a market cap of about $140 million, so it is not at immediate risk of being delisted.

Does any of this matter?

Yes and no.  I currently own Siemens, for example, and I consider its delisting to be a non-event.  Siemens is a healthy company with more than sufficient liquidity in both Germany and in the U.S. over-the-counter market.  I own several European companies that trade over-the-counter, including German automaker Daimler (DDAIF) and Swiss confectionary giant Nestle (NSRGY).

But would I want to own a delisted American company?

Absolutely not.  Remember, if a stock has been involuntarily delisted, it is because it has failed to meet basic quality standards, and the exchange is effectively washing its hands of it.  Stocks that are delisted are often on the express train to bankruptcy and should be avoided.

And RadioShack?

It will stick around on the Big Board a little longer, it seems.  But I wouldn’t recommend buying it.

This article first appeared on InvestorPlace.

Charles Lewis Sizemore, CFA, is the editor of Macro Trend Investor and chief investment officer of the investment firm Sizemore Capital Management. Click here to receive his FREE weekly e-letter covering top market insights, trends, and the best stocks and ETFs to profit from today’s best global value plays.