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Is KeyCorp Well-Positioned to Support Its Capital Return Strategy?
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Key Takeaways
KeyCorp maintains steady dividends and active buybacks to support shareholder returns.
KEY authorized a $1B buyback in March 2025 and plans $1.2B in repurchases in 2026.
KeyCorp holds $11.5B in liquidity and investment-grade ratings, backing capital returns.
KeyCorp (KEY - Free Report) maintains a disciplined capital distribution approach, aiming to return value to shareholders through dividends and share repurchases.
In 2022, KeyCorp raised its quarterly dividend by 5.1% to 20.5 cents per share and has maintained this level since then. Over the past five years, the company has increased its dividend twice.
The company has a five-year annualized dividend growth rate of 2.2% and a payout ratio of 55%. KEY currently offers a dividend yield of 3.9%. Rather than pursuing aggressive hikes, the company has prioritized a steady and sustainable dividend policy, which strengthens its long-term financial position and supports investor confidence.
KEY Dividend Yield
Image Source: Zacks Investment Research
Apart from dividends, KeyCorp has been actively executing share repurchases. In March 2025, the company authorized a buyback program of up to $1 billion with no expiration date. Share repurchases began in the fourth quarter of 2025, and as of Dec. 31, 2025, $0.8 billion remained available under the authorization. Management intends to repurchase approximately $1.2 billion worth of shares in 2026, including around $300 million in the first quarter.
Additionally, KEY continues to focus on acquiring niche, entrepreneurial businesses to strengthen its fee-based income. Its strong capital and liquidity position support both growth initiatives and shareholder returns.
As of Dec. 31, 2025, KeyCorp had total debt of $15.3 billion (the majority of this is long-term in nature). It also held $11.5 billion in cash, due from banks and short-term investments, providing a solid liquidity cushion. It also carries investment-grade long-term issuer ratings of Baa2 from Moody's Investors Service, BBB from S&P Ratings and A- from Fitch Ratings. These ratings reflect that it will likely be able to continue meeting debt obligations, even if the economic situation worsens.
KeyCorp’s consistent dividends, active share repurchases and disciplined payout strategy reflect strong capital management and financial stability. Backed by solid liquidity and a steady earnings base, it is well-positioned to sustain capital distribution activities and reinforce investor confidence in its long-term prospects.
KEY’s Price Performance & Zacks Rank
KEY shares have rallied 17.4% in the past three months, compared with the industry’s growth of 17.2%.
How Do KEY’s Peers Maintain Disciplined Capital Distribution?
Similar to KeyCorp, its peers, The PNC Financial Services Group, Inc. (PNC - Free Report) and Northern Trust Corporation (NTRS - Free Report) , are well-positioned to continue maintaining a disciplined capital distribution approach, supported by a solid liquidity position and consistent earnings strength.
In January, PNC Financial announced a 6% increase in its quarterly dividend to $1.70 per share. Over the past five years, the company has raised its dividend five times, delivering an annualized growth rate of 7.8%.
PNC also has a share repurchase plan in place. As of Dec. 31, 2025, nearly 35 million shares remained available under the authorization. Management expects to repurchase approximately $600 million to $700 million worth of shares in the first quarter of 2026.
Likewise, Northern Trust raised its quarterly dividend by 6.7% to 80 cents per share in January. Over the past five years, the company has increased its dividend twice with an annualized dividend growth rate of 2.5%.
Beyond dividends, NTRS has a share repurchase program in place. As of Dec. 31, 2025, 1.9 million shares were available under the plan. During the fourth quarter of 2025, the company repurchased nearly 2.9 million shares for $369.8 million. Management expects to continue a similar level of share repurchase activity in the upcoming quarters.
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Is KeyCorp Well-Positioned to Support Its Capital Return Strategy?
Key Takeaways
KeyCorp (KEY - Free Report) maintains a disciplined capital distribution approach, aiming to return value to shareholders through dividends and share repurchases.
In 2022, KeyCorp raised its quarterly dividend by 5.1% to 20.5 cents per share and has maintained this level since then. Over the past five years, the company has increased its dividend twice.
The company has a five-year annualized dividend growth rate of 2.2% and a payout ratio of 55%. KEY currently offers a dividend yield of 3.9%. Rather than pursuing aggressive hikes, the company has prioritized a steady and sustainable dividend policy, which strengthens its long-term financial position and supports investor confidence.
KEY Dividend Yield
Image Source: Zacks Investment Research
Apart from dividends, KeyCorp has been actively executing share repurchases. In March 2025, the company authorized a buyback program of up to $1 billion with no expiration date. Share repurchases began in the fourth quarter of 2025, and as of Dec. 31, 2025, $0.8 billion remained available under the authorization. Management intends to repurchase approximately $1.2 billion worth of shares in 2026, including around $300 million in the first quarter.
Additionally, KEY continues to focus on acquiring niche, entrepreneurial businesses to strengthen its fee-based income. Its strong capital and liquidity position support both growth initiatives and shareholder returns.
As of Dec. 31, 2025, KeyCorp had total debt of $15.3 billion (the majority of this is long-term in nature). It also held $11.5 billion in cash, due from banks and short-term investments, providing a solid liquidity cushion. It also carries investment-grade long-term issuer ratings of Baa2 from Moody's Investors Service, BBB from S&P Ratings and A- from Fitch Ratings. These ratings reflect that it will likely be able to continue meeting debt obligations, even if the economic situation worsens.
KeyCorp’s consistent dividends, active share repurchases and disciplined payout strategy reflect strong capital management and financial stability. Backed by solid liquidity and a steady earnings base, it is well-positioned to sustain capital distribution activities and reinforce investor confidence in its long-term prospects.
KEY’s Price Performance & Zacks Rank
KEY shares have rallied 17.4% in the past three months, compared with the industry’s growth of 17.2%.
Image Source: Zacks Investment Research
At present, KEY carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
How Do KEY’s Peers Maintain Disciplined Capital Distribution?
Similar to KeyCorp, its peers, The PNC Financial Services Group, Inc. (PNC - Free Report) and Northern Trust Corporation (NTRS - Free Report) , are well-positioned to continue maintaining a disciplined capital distribution approach, supported by a solid liquidity position and consistent earnings strength.
In January, PNC Financial announced a 6% increase in its quarterly dividend to $1.70 per share. Over the past five years, the company has raised its dividend five times, delivering an annualized growth rate of 7.8%.
PNC also has a share repurchase plan in place. As of Dec. 31, 2025, nearly 35 million shares remained available under the authorization. Management expects to repurchase approximately $600 million to $700 million worth of shares in the first quarter of 2026.
Likewise, Northern Trust raised its quarterly dividend by 6.7% to 80 cents per share in January. Over the past five years, the company has increased its dividend twice with an annualized dividend growth rate of 2.5%.
Beyond dividends, NTRS has a share repurchase program in place. As of Dec. 31, 2025, 1.9 million shares were available under the plan. During the fourth quarter of 2025, the company repurchased nearly 2.9 million shares for $369.8 million. Management expects to continue a similar level of share repurchase activity in the upcoming quarters.