2024-03-11 20:41:57 ET
Summary
- Shares of KeyCorp have underperformed in the regional banking sector but have outperformed many regional banks, given stable deposits.
- Key's asset mix leaves it well-insulated from ongoing pressures in commercial real estate, making shares attractive.
- Key's stable deposit base, conservative reserving, and small exposure to troubled asset classes make it a safe haven within the regional banking sector.
Shares of KeyCorp ( KEY ) have been an underperformer over the past, alongside most of the regional banking sector, as the industry faced pressures in the wake of Silicon Valley Bank’s failure. I last wrote about Key in October 2022, before the regional banking crisis, rating the stock a “buy.” Since then, it has returned just 3%, significantly lagging the S&P 500, though KEY has outperformed most regional banks with a leading ETF ( KRE ) losing about 16% of its value since then. Importantly, I believe Key’s asset mix leaves it well-insulated from ongoing pressures in commercial real estate, making shares attractive today....
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KeyCorp's Balance Sheet Optimization Can Lift Shares