KEY

KeyCorp

Finance/Real Estate


Presented:02/18/2016
Price:$10.70
Cap:$8.94B
Current Price:$17.49
Cap:$16.50B

Presented

Date02/18/2016
Price$10.70
Market Cap$8.94B
Ent Value$21.81B
P/E Ratio10.24x
Book Value$12.51
Div Yield0%
Shares O/S835.94M
Ave Daily Vol16,037,998
Short Int5.36%

Current

Price$17.49
Market Cap$16.50B
KeyCorp is a bank holding company. The company through its subsidiary, KeyBank National Association provides a wide range of retail and commercial banking, commercial leasing, investment management, consumer finance and investment banking products and services to individual, corporate and institutional clients. It operates through two business segments: Key Community Bank, Key Corporate Bank and Other. The Key Community Bank segment serves individuals and small to mid-sized businesses by offering a variety of deposit, investment, lending, and personalized wealth management products and services. The Key Corporate Bank segment focuses on on serving the needs of middle market clients in six industry sectors: consumer, energy, healthcare, industrial, public sector and real estate. Key Corporate Bank delivers a broad product suite of banking and capital markets products to its clients, including syndicated finance, debt and equity capital markets, commercial payments, equipment finance, commercial mortgage banking, derivatives, foreign exchange, financial advisory, and public finance. The Other segments consist of corporate treasury, community development, principal investing, and various exit portfolios. KeyCorp was founded in 1958 and is headquartered in Cleveland, OH.

Publicly traded companies mentioned herein: First Niagara Financial Group Inc (FNFG), KeyCorp (KEY)

Highlights

The presenter said he sees upside potential for the “out of favor” regional banks in the present environment, with the group trading at a steeper than normal discount to the broader market. While the overall performance of the group is largely predicated on macro factors, he sees a particularly favorable risk/ reward in shares of KeyCorp (KEY). He is long the stock at ~$11 and sees the potential for $4 - $5 per share of upside based on future expected earnings power (including the accretion from the First Niagara deal), and very limited downside risk.

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Idea Discussion

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