CIT Losses $7.88 a Share, Stock Rallies to $7.64

While it's true that investors were anticipating a huge loss from the company due to the sale of its home lending business, you still have to hand it to CIT for beating estimates from analysts.  The beleaguered commercial lender lost $2.07 billion in the quarter.  Excluding the losing sale of the home lending business, the lender had a profit of $48.1 million.  The company increased credit losses by $60 million and spent $15 million more on interest costs (despite a lower interest rate environment).  Furthermore, the company spent $17 million on severance and $69.1 million to exit some real estate deals.  CEO Jeffrey Peek, claimed the results were "quite respectable."  I'd hate to see what he considers a weak quarter.  While investors seem to be willing to put the lender's dismal past behind them, the increase in delinquencies may be of concern.  Commercial borrowers who were at least 60 days behind on payments rose to 2.43%, compared with 1.7% in the first quarter.  If the company was out of the woods, the trend for delinquencies would be heading in the opposite direction.  But perhaps the stock is attempting to rally to $7.88 a share so that the math makes sense.  After all, can you lose $7.88 a share if you are only a $7 stock?