KeyCorp (KEY)
Valuation Overview•Is KeyCorp Overvalued or Undervalued?
Market price has outpaced base-case intrinsic cash flows, pricing in significant future growth optimism.
Moderate quality score of 55/100, reflecting stable operating margins and manageable leverage.
Wall Street forecasts a balanced outlook with consensus price targets near the current price.
Verdict: Average quality business weighed down by significant solvency concerns.
Wall Street sentiment is generally neutral with steady expected earnings growth. This outlook is strongly supported by highly attractive capital returns, anchored by a strong, well-covered dividend yield.
KEY demonstrates adequate business quality with stable profitability. However, this is severely offset by a highly leveraged balance sheet (Debt/EBITDA > 4.0x) and elevated financial risk.
The company maintains stable top-line performance however, earnings have severely contracted over the same period. The company maintains healthy operational efficiency with a 20.6% operating margin.
| Financial Metric | Trend (12Q) | Latest Qtr | 1Y Growth | 3Y CAGR | 5Y CAGR | 10Y CAGR |
|---|---|---|---|---|---|---|
| Revenue | $2.9B | +23.6% | — | — | +9.9% | |
| EBITDA | $648.0M | — | -2.4% | — | — | |
| Net Income | $510.0M | +1236.0% | -1.6% | — | +7.2% | |
| EPS (Diluted) | $0.43 | +575.0% | -7.7% | +3.7% | +3.8% | |
| Free Cash Flow | $673.0M | +250.8% | -21.6% | +5.5% | — |
| Metric | TTM | 3Y Avg | 5Y Avg | 10Y Avg |
|---|---|---|---|---|
| Gross Margin | 62.3% | 54.4% | 69.4% | 75.8% |
| Operating Margin | 20.6% | 9.5% | 20.5% | 23.0% |
| Net Margin | 16.3% | 8.0% | 16.8% | 18.7% |
| FCF Margin | 18.8% | 17.5% | 24.5% | 27.2% |
| Quarter | EPS Est. | EPS Act. | Surprise | EPS | Rev |
|---|---|---|---|---|---|
| Q2'26Latest | $0.41 | $0.44 | +7.3% | ||
| Q1'26 | $0.39 | $0.41 | +5.9% | ||
| Q4'25 | $0.38 | $0.41 | +7.9% | ||
| Q3'25 | $0.35 | $0.35 | +1.2% | ||
| Q2'25 | $0.32 | $0.33 | +3.8% | ||
| Q1'25 | $0.32 | $0.38 | +18.8% | ||
| Q4'24 | $0.28 | $0.30 | +7.3% | ||
| Q3'24 | $0.24 | $0.25 | +4.2% |
Total return is +46.2% (1Y), outperforming the benchmark by +21.2%
| Period | Total Return | vs S&P 500 (Alpha) | Dividend Contribution |
|---|---|---|---|
| YTD | +9.6% | +0.3% | — |
| 1Y | +46.2% | +21.2% | +5.1% |
| 3YCAGR | +36.5% | +17.0% | +25.0% |
| 5YCAGR | +6.0% | -7.1% | +20.3% |
| 10YCAGR | +9.8% | -3.9% | — |
The S&P 500 is at 31.3x trailing P/E — Expensive relative to historical averages.
Quick answers to common questions about KeyCorp (KEY) valuation, health, and returns.
KeyCorp is estimated to be overvalued under our discounted cash flow framework. relative multiples indicate the stock is Fair versus peers compared to industry peers. overvalued (implying -17.4% downside from DCF intrinsic value of $18.65)
KeyCorp has multiple valuation anchors: DCF Intrinsic Value: $18.65 | Peer Relative Fair Value: $21.82 | Wall Street Analyst Target: $23.33 (implying +3.3% upside). A convergence of these signals offers higher conviction.
KeyCorp displays fair financial health with a composite quality score of 55/100, supported by a Piotroski F-Score of 8/9, Return on Invested Capital (ROIC) of 5.4%.
KeyCorp pays a 4.3% dividend yield, covered by a 58% payout ratio with 0 years of growth, supplemented by a 0.9% buyback yield.
KeyCorp's current growth trajectory is Accelerating. The company achieved +23.6% 1Y revenue growth and +575.0% 1Y EPS growth, compared to its 3Y revenue CAGR of N/A.
Wall Street consensus is Buy based on 51 analysts, beating EPS expectations in 83% of recent quarters with a 8-quarter streak. The consensus price target represents a +3.3% change from current levels.
Investment risks for KeyCorp include: -18.6% 1-year max drawdown. Volatility risk is characterized by a beta of 0.90x.
No. These computations are purely quantitative model outputs for informational purposes. They do not account for qualitative management shifts or macro events. Always consult a licensed RIA before buying or selling shares.
Disclaimer: This page is for informational purposes only and does not constitute financial advice. All valuation models, scores, and target estimates are automated computations under stated assumptions and should not be relied upon as the sole basis for any investment decision.