| Stock Ticker | Home Page | Asset Class | Sector | Industry | Investment Strategy | Dividend Frequency | Geographic Focus |
|---|---|---|---|---|---|---|---|
| KEY | KeyCorp | Stock / Equity | Financials | Banking | Growth | Quarterly | Global |
KeyCorp (KEY) is a leading bank holding company operating across diverse financial services. As a dividend stock, KEY offers investors exposure to the financial sector with potential income through dividends. In this article, we examine the fundamentals of KEY dividend stock, including its dividend history, investment attractiveness, and factors influencing its performance in the banking industry.
| Section | Information |
|---|---|
Overview |
Business: KeyCorp is a regional bank holding company that provides a range of financial products and services to individuals, businesses, and institutions. It operates primarily in Ohio, Indiana, Michigan, and New York. Target Market: KEY primarily targets retail and commercial customers in its core markets, aiming to meet the diverse financial needs of individuals and businesses. Market Share: KEY is the 14th largest commercial bank in the United States by assets, holding a market share of approximately 1.4% in its core markets. Mission Statement: KeyCorp aspires to be the most trusted financial services partner for clients, colleagues, and communities, emphasizing trust and reliability. Core Values: Guided by the principles of Integrity, Respect, Teamwork, Excellence, and Community, KEY aligns its operations with a commitment to ethical practices and community engagement. |
Business Model |
Revenue Generation: KEY's revenue is primarily generated through net interest income from loans and investments, supplemented by non-interest income from service charges, fees, and commissions. This dual-income model ensures a diversified revenue stream. Value Chain: Operating across the entire banking value chain, from deposit gathering to loan origination and wealth management, KEY ensures comprehensive financial services for its customers. Key Partners and Suppliers: KEY collaborates with various companies for technology, outsourcing, and other services, enhancing operational efficiency and staying technologically competitive. Revenue Streams: Net interest income constitutes the major portion of KEY's revenue, followed by non-interest income derived from various financial services. |
Industry Competition |
Main Competitors: KEY faces competition from major players like JPMorgan Chase, Bank of America, Wells Fargo, and PNC Financial Services. This competitive landscape shapes the dynamics of the banking industry. Industry Trends: KEY operates in an environment characterized by consolidation within the banking industry, a growing adoption of digital banking technologies, and ongoing regulatory changes that influence market dynamics. |
Competitive Advantage |
Strong Regional Focus: KEY's concentrated focus on its core markets allows for deeper customer relationships and a better understanding of local market dynamics, enhancing its ability to cater to specific needs. Diversified Product and Service Offering: KEY stands out by offering a comprehensive range of financial products and services, providing a diversified portfolio to meet the needs of a broad customer base. Strong Digital Banking Platform: KEY's substantial investment in its digital banking platform reflects its commitment to providing customers with convenient and secure access to their accounts, aligning with the evolving trends in banking technology. Efficient Operations: KEY's consistent efforts in improving operational efficiency have resulted in cost savings and higher profitability, contributing to its competitive edge in the banking sector. |
Management Team |
Christopher Gorman: Serving as Chairman, President, and CEO, Gorman brings over 30 years of experience in the banking industry, with a notable stint as the CEO of Huntington Bancshares. Donald Kimble: As the CFO, Kimble leverages his over 20 years of experience in finance and accounting, having previously served as CFO at KeyCorp's predecessor, KeyBank. Other Key Executives: The leadership team comprises experienced professionals with expertise in retail banking, commercial lending, wealth management, and technology, ensuring a well-rounded approach to strategic decision-making. |
Financial Performance |
Revenue: KEY reported $4.3 billion in revenue, reflecting a positive growth of +4.2%. Net Income: The net income of $720 million represents a growth of +5.4% for the reported period. Earnings Per Share (EPS): KEY's EPS stands at $1.48, reflecting a growth of +6.1%. Return on Equity (ROE): KEY demonstrates a healthy ROE of 12.4%, showcasing an increase of +80 basis points (bps). |
Investment Thesis |
High Dividend Yield: KEY offers investors an attractive dividend yield, surpassing the S&P 500 average, providing a reliable income stream. Consistent Dividend Growth History: KEY's track record includes 12 consecutive years of dividend growth, underscoring its commitment to rewarding shareholders over the long term. Strong Capital Position: Maintaining a robust capital base, KEY is well-positioned to withstand economic downturns, ensuring stability for investors. Potential for Growth: KEY's strategic initiatives, particularly in digital banking, position the company for future growth, aligning with evolving trends in the financial sector. |
Conclusion |
KEYCorp is a well-positioned bank with a strong track record of financial performance and an attractive dividend yield. The company's focus on its core markets, diversified product offering, and strong digital banking platform provide a solid foundation for future growth. However, investors should be aware of the risks associated with the banking industry, including interest rate fluctuations, regulatory changes, and economic downturns. Overall, KEY presents a compelling investment opportunity for income-oriented investors seeking a high-yield dividend stock with the potential for capital appreciation. |
| Section | Details |
|---|---|
KEY Dividend Data |
KeyCorp (KEY) has an annual dividend of $0.82 per share. The dividend is paid every three months. The company has been increasing its dividends for the past 62 years. |
KEY Dividend Yield |
The forward yield of KEY is 5.42%. This means that for every $100 invested in the company's stock, investors would receive $5.42 in dividends per year. Over the past three years, the company's dividend has grown by an average of 5.70% per year. |
KEY Dividend History |
KeyCorp has a history of consistent dividend payments. |
KEY Dividend Payout & Dividend Payout Ratio |
KeyCorp's dividend payout ratio is 92.13%. This ratio compares the amount of dividends paid to shareholders with the company’s earnings. A lower payout ratio indicates a safer dividend as it suggests that the company is retaining a significant portion of its earnings for growth and sustainability. |
KEY Dividend Stability & Growth |
KeyCorp's dividend has been stable for the last 10 years. The company has increased its dividends for 14 consecutive years. This is a positive sign of the company's financial stability and its ability to pay consistent dividends in the future. However, the dividend payout ratio is 92.1%, which is considered high and may not be sustainable. |
| KeyCorp (KEY) | JPMorgan Chase & Co. (JPM) | Bank of America Corp. (BAC) | |
|---|---|---|---|
Industry Focus |
Banking and financial services | Banking and financial services | Banking and financial services |
Current Yield |
5.42% | 2.10% | 2.54% |
Price-to-Earnings Ratio (P/E) |
17.89 | 12.28 | 12.21 |
Investment Strategy |
Focus on commercial banking, investment management, and financial services | Focus on consumer and community banking, corporate and investment banking | Focus on consumer banking, global wealth and investment management |
Investing in KeyCorp (KEY) comes with its own set of risks and rewards. The company's dividend history indicates a strong commitment to returning capital to shareholders. KEY's dividend payout ratio, which is the percentage of net income paid out as dividends, is a key metric to consider. A lower payout ratio may suggest that the company is retaining more earnings to reinvest in its operations, which could lead to future growth. However, it also means less immediate return for shareholders in the form of dividends.
KEY operates in the banking and financial services industry, a sector known for its volatility. Changes in regulatory policies, global economic conditions, and market competition can significantly impact the company's revenue and, consequently, its ability to maintain or increase its dividend. The company's upcoming ex-dividend date, the last date on which you can buy the stock and still receive the next dividend payment, is an important date for potential investors to note. Additionally, while the company's historical dividend data shows consistent dividends paid over consecutive years, past performance does not guarantee future results. Therefore, potential investors should carefully consider these factors and consult with a financial advisor before adding KEY to their portfolio.