NEW YORK (TheStreet) -- Shares of CIT Group Inc. (CIT) are higher by 11.17% to $48.86 on heavy trading volume on Tuesday morning, continuing a gain started during the pre-market session, after the company announced it will buy OneWest Bank in a $3.4 billion cash and stock transaction, CNBC reports.
The bank is owned by the privately held IBM Holdco, and as part of the deal IMB shareholders will receive $2 billion in cash and 31.3 million CIT Group shares, valued at $1.4 billion, CNBC added.
The company expects the deal to add 20% to CIT Group's earnings per share for 2016.
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Separately, TheStreet Ratings team rates CIT GROUP INC as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate CIT GROUP INC (CIT) a SELL. This is driven by multiple weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share."
Highlights from the analysis by TheStreet Ratings Team goes as follows: