KeyCorp

Based on a comprehensive analysis of KEY, here is a balanced assessment.

Technical Analysis KEY exhibits strong positive momentum, having significantly outperformed the market recently. However, its current price near a 52-week high suggests the technical rally may be stretched, pointing to potential near-term consolidation or pullback before further gains.

Fundamentals & Valuation The company shows stable revenue and profitability, but operational efficiency is subdued with a low return on equity. The valuation presents a mixed picture: the low forward P/E and PEG ratio suggest attractiveness based on future earnings growth, yet a high EV/EBITDA ratio signals the overall enterprise value is expensive.

Risk & Peer Context KEY carries standard market volatility, but its inability to cover interest payments from operating income is a notable financial risk. The lack of peer data makes it difficult to definitively judge if its valuation is justified within the sector, adding a layer of uncertainty.

Recommendation KEY presents a compelling case based on its earnings growth trajectory and strong price momentum. However, its overbought technical levels, weak interest coverage, and rich enterprise valuation warrant caution. For investors with a medium-to-long-term horizon who are comfortable with some volatility, KEY could be a cautious buy on any market-driven pullbacks. It is less suitable for risk-averse investors seeking stable, immediate returns.

*Note: This is not investment advice, for reference only.*

RockFlow Model Forecast: Three Scenarios for 2026

Based on a comprehensive analysis, the 12-month outlook for KEY is cautiously optimistic, contingent on market conditions. The primary catalyst is the company's attractive earnings growth trajectory, as indicated by its low PEG ratio, which could drive investor interest if realized. Key risks include its stretched technical levels near 52-week highs suggesting potential for near-term consolidation, alongside a significant financial risk from its weak ability to cover interest payments with operating income. In the absence of a consensus analyst target price, a prudent target range would be in the low-to-mid $20s, assuming the stock digests its recent gains and its fundamental growth story remains intact.

Wall Street Consensus

Most Wall Street analysts are optimistic about KeyCorp's 12-month outlook, with consensus target around $21.79, indicating expected upside potential.

Overall, KEY has investment potential but also faces challenges. Here are key factors to weigh before investing.

KEY has delivered strong absolute performance with significant outperformance relative to the broader market over the past quarter. The stock demonstrates notable volatility while currently trading near its 52-week high, suggesting stretched valuations in the near term.

Over the past three months, KEY has surged nearly 20%, substantially outperforming the market by approximately the same margin. While recent one-month gains have moderated to 2.17%, this still represents positive momentum, with the stock's beta of 1.068 indicating slightly higher volatility than the overall market.

Currently trading at $21.69, KEY sits just 7.1% below its 52-week high of $23.35, positioning it in the upper quartile of its yearly range. Given its proximity to recent highs and the substantial rally from its 52-week low of $12.73, the stock appears overbought despite the maximum drawdown of -26.62% highlighting its volatile nature.

Revenue & Profitability KEY demonstrated modest sequential revenue growth from $2.83B to $2.86B in Q4 2025, while net profit margin improved slightly from 17.3% to 17.8%. The company maintained a healthy gross profit margin above 66%, though operating margins remain pressured by elevated interest expenses relative to earnings before interest.

Financial Health KEY’s debt ratios appear manageable, with a low debt-to-equity ratio of 0.54 and total debt to capitalization at 35%. However, the interest coverage ratio of 0.75 signals weakness in meeting interest obligations from operating income, and cash ratios are minimal, indicating limited liquidity buffers.

Operational Efficiency Return on equity was modest at 2.5%, weighed down by a very low asset turnover of 0.016. The extended days sales outstanding of over 3,300 days reflects the nature of banking receivables, but overall operational efficiency metrics indicate room for improvement in capital deployment and revenue generation from assets.

Valuation Level: With a trailing PE ratio of 22.24 that is substantially higher than the forward PE of 11.08, KEY appears to be transitioning towards a more attractive valuation based on expected earnings growth. This expectation is further supported by a PEG ratio below 1.00, traditionally indicating the stock is potentially undervalued relative to its earnings growth prospects. However, the notably high EV/EBITDA ratio of 49.87 introduces a point of concern regarding its overall enterprise value.

Peer Comparison: A conclusive peer comparison cannot be performed as industry average data is unavailable. Therefore, it is impossible to determine whether KEY's valuation multiples are trading at a premium or discount to its sector. Such a comparison would be essential for placing its 22.24 TTM PE and 1.19 PB ratio into a proper industry context.

Volatility Risk: With a beta of 1.068, KEY is expected to exhibit volatility very close to that of the broader market, implying a standard level of systematic risk. The relatively significant one-year maximum drawdown of -26.62% highlights that the stock has experienced substantial peak-to-trough declines, indicating notable price fluctuation risk for investors during that period.

Other Risks: The absence of any reported short interest suggests a lack of significant negative sentiment or targeted bearish bets against the stock from sophisticated investors. While this can be viewed positively, investors should still assess broader market liquidity and company-specific fundamental risks, as the lack of short interest does not inherently eliminate other operational or financial vulnerabilities.