Back to top

Analyst Blog

On Sep 10, 2013, we reiterated our long-term recommendation on KeyCorp. (KEY - Analyst Report) at Neutral. Our decision was based on the company’s robust second-quarter earnings and strong balance sheet position. However, sluggish economic recovery and a stringent regulatory landscape remain causes of concern.

Why Neutral?

KeyCorp’s second-quarter adjusted earnings outpaced the Zacks Consensus Estimate. Results benefited from a rise in net interest income, partially offset by higher operating expenses and a fall in fee income. Moreover, continued improvement in asset quality and strong capital ratios were the other highlights for the quarter.

We view KeyCorp as an asset for yield-seeking investors. The company has been meaningfully deploying capital to boost investors’ confidence. Further, KeyCorp has chalked out an expense reduction program with the target of generating cost savings of $200 million by the end of 2013.

The Zacks Consensus Estimate for 2013 increased by a penny to 88 cents per share over the last 60 days. For 2014, the Zacks Consensus Estimate advanced 3.1% to $1.00 per share over the same time frame. KeyCorp currently carries a Zacks Rank #3 (Hold).  

On the flip side, pressure on net interest margin remains a major concern for KeyCorp. Additionally, sluggish economic recovery and stringent regulations could negatively impact the company’s financials going forward. Further, a more rigid capital requirement will likely hamper the company’s flexibility with respect to its business investments.

Other Banks to Consider

Some better-performing banks include PrivateBancorp, Inc. (PVTB - Snapshot Report), First Interstate Bancsystem Inc. (FIBK - Snapshot Report) and East West Bancorp, Inc. (EWBC - Snapshot Report). All these stocks carry a Zacks Rank #1 (Strong Buy).

Please login to or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research


Are you a new Zacks Member or a visitor to

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
PLANAR SYST… PLNR 4.44 +5.21%
BITAUTO HOL… BITA 81.71 +5.12%
CTPARTNERS… CTP 16.66 +4.26%
CHINA BIOLO… CBPO 47.91 +3.30%
MALLINCKROD… MNK 72.94 +2.85%