Bank of America Securities analyst Ebrahim Poonawala maintained a Buy rating on KeyCorp (KEY – Research Report) yesterday and set a price target of $16.00.
Ebrahim Poonawala has given his Buy rating due to a combination of factors concerning KeyCorp’s strategic shift and financial outlook. He cites the company’s transition from defensive strategies, like optimizing risk-weighted assets and cost reduction, to adopting an offensive approach to growth as a key driver. Poonawala views the company’s relatively low exposure to commercial real estate and their improving balance sheet, evidenced by a solid loan-to-deposit ratio and increasing common equity tier 1 capital, as favorable indicators. Additionally, the reaffirmation of KeyCorp’s net interest income growth projection, despite the challenges of an uncertain macroeconomic environment, further supports the positive outlook.
Poonawala also emphasizes KeyCorp’s focus on achieving targeted scale in specific markets and verticals, particularly in regions with promising demographics and opportunities for market share expansion. The bank’s cautious approach to crossing regulatory asset thresholds, which would increase its regulatory burden, is seen as a prudent strategy to avoid unnecessary complexity. Moreover, the bank’s resilience in maintaining net interest income guidance, even with the potential for multiple Federal Reserve rate cuts, and its strategy of originating loans for sale to maintain client relationships while reducing balance sheet risk, are highlighted as strengths. Poonawala believes these factors position KeyCorp well for potential growth and justify the Buy rating.
According to TipRanks, Poonawala is a 4-star analyst with an average return of 4.5% and a 58.43% success rate. Poonawala covers the Financial sector, focusing on stocks such as Truist Financial, Fifth Third Bancorp, and JPMorgan Chase & Co..
See Insiders’ Hot Stocks on TipRanks >>
TipRanks tracks over 100,000 company insiders, identifying the select few who excel in timing their transactions. By upgrading to TipRanks Premium, you will gain access to this exclusive data and discover crucial insights to guide your investment decisions. Begin your TipRanks Premium journey today.
KeyCorp (KEY) Company Description:
KeyCorp operates as bank holding company. The company operates through the following segments: Consumer Bank and Commercial Bank. The Consumer Bank segment offers deposit and investment products, personal finance and financial wellness services, lending, mortgage and home equity, student loan refinancing, credit card, treasury services, and business advisory services. The Commercial Bank segment engages in serving the needs of middle market clients in seven industry sectors: consumer, energy, healthcare, industrial, public sector, real estate, and technology The company was founded in 1958 and is headquartered in Cleveland, OH.
Read More on KEY:
- IRS sues FDIC over Silicon Valley Bank’s $1.4B tax debt, Reuters says
- KeyCorp put volume heavy and directionally bearish
- KeyCorp price target raised to $16 from $12 at Morgan Stanley
- KeyCorp price target raised to $17 from $16 at Piper Sandler
- KeyCorp price target lowered to $16 from $17 at DA Davidson
