Shares of CIT Group (NYSE:CIT) plunging Friday, down over 25%, after Bloomberg reported that the FDIC will be unwilling to guarantee the company's bonds due to deteriorating credit quality. Earlier this week, Fitch Ratings downgraded some of CIT's credit ratings already at junk bond levels. The downgrade effected about 35 billion dollars worth of debt. Fitch said default is a real possibility should the FDIC fail to back its bonds. CIT would then be forced to seek alternative funding sources to meet its debt obligations over the next 1 to 2 years, which could mean sharply curtailing new business, seeking a debt exchange, as well as selling off assets.
PriceSmart (NASDAQ:PSMT) announced its third quarter results, but investors were not happy with the bottom line earnings, sending shares down over 11% in early trading Friday. Even though revenue climbed 25%, the company earned nearly 17% less than it did in the same quarter last year, with earnings per share at 30 cents, down from 36 cents. The company said the comparable prior year quarter's results were inflated by a 2 million dollar expense reversal.
Chase Corporation (AMEX:CCF), a manufacturer of tapes, laminates, sealants and coatings -- not to be confused with Chase Bank -- reported its third quarter earnings after the bell Thursday. Revenue declined 26% year over year, while earnings plunged 73% to 10 cents per share compared to 37 cents in the same quarter last year. The company said the recent quarters have been extremely challenging, effected by the poor economy. Shares of Chase Corporation down almost 6% in early trading Friday.
Also reporting earnings after the bell Thursday are consulting company FranklinCovey (NYSE:FC), reporting a larger loss of 38 cents per share, compared to a loss of just 9 cents in the same quarter last year -- that stock down over 11% -- and technology company The Shaw Group (SGR), reporting earnings of 9 cents per share, down from 62 cents per share in the same quarter last year. The Shaw Group's Westinghouse segment weighed on results; excluding that segment earnings would have been 57 cents per share. The Shaw Group trading down over 9% on Friday.
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