KEY's third-quarter results may get a lift from fee income and higher NII, though rising provisions can temper the gains.
KeyCorp (KEY) possesses the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.
KeyCorp (KEY) has an impressive earnings surprise history and currently possesses the right combination of the two key ingredients for a likely beat in its next quarterly report.
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KeyCorp's Series I preferred shares offer the highest yield potential, set to float at 8.2% based on current rates, making them my top pick for income investors. The bank has improved net interest income for five consecutive quarters, driven by rising asset yields and effective management of interest expenses. Loan growth has resumed while deposit declines remain manageable, keeping the loan-to-deposit ratio conservative and supporting stable external financing needs.
KeyCorp (KEY) reported earnings 30 days ago. What's next for the stock?
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KeyCorp beat Q2 expectations, with strong net interest income and solid core loan performance. The current interest rate environment supports net interest income growth, but potential Fed rate cuts create a neutral risk profile. KeyCorp's valuation has recovered post-2023 crisis, now trading at historical price-to-book averages, limiting upside potential.
Keycorp gets upgraded to a buy, from my prior hold rating, as my bullishness on this stock returns. It has proven it can grow its non-loan business, generate dividend growth, and improve its balance sheet risk profile as well as keep investment-grade credit ratings. Beyond its Ohio origins, this brand has managed to penetrate multiple US regions.
KeyCorp's capital position has strengthened significantly, supporting growth and improved net interest margin through strategic asset repositioning and a stake sale to Scotiabank. Loan growth is accelerating, deposit costs are declining, and asset yields are rising, driving a 28% increase in net interest income year-over-year. Credit quality remains solid with healthy reserves, and upgraded guidance reflects building momentum as Key transitions to a growth-focused strategy.
KeyCorp (NYSE:KEY ) Q2 2025 Earnings Conference Call July 22, 2025 9:00 AM ET Company Participants Brian Mauney - Director of Investor Relations Christopher Gorman - Chairman, President & CEO Clark Khayat - Chief Financial Officer Mohit Ramani - Chief Risk Officer Conference Call Participants Ryan Nash - Goldman Sachs Group, Inc., Research Division Robert Siefers - Piper Sandler & Co., Research Division Ebrahim Poonawala - BofA Securities, Research Division Christopher McGratty - Keefe, Bruyette, & Woods, Inc., Research Division Kenneth Usdin - Bernstein Autonomous LLP Manan Gosalia - Morgan Stanley, Research Division L. Erika Penala - UBS Investment Bank, Research Division John Pancari - Evercore ISI Institutional Equities, Research Division Matthew O'Connor - Deutsche Bank AG, Research Division Operator Good morning, and welcome to KeyCorp's Second Quarter 2025 Earnings Conference Call.