Tuesday, October 13, 2009

CIT floundering (CIT)

75million CIT shares have traded hands today, with the stock off 14%. Sources close to bondholder negotiations have leaked information suggesting that bankruptcy is a more likely scenario than a debt exchange.

As I noted two weeks ago, there is not much of a "pie" to be split up for stockholders.

The rumors today don't help. In the "balance sheet shuffle," a lot would have to go right for there to be any value left for common stockholders. The shares are likely headed to zero.

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