Deutsche Bank Downgrades KeyCorp (KEY) to Hold, Exposed to Higher RMBS Prepays/Lower Reinvestment Rates
Tweet Send to a FriendGet Alerts KEY Hot Sheet
Price: $10.69 -1.57%
Rating Summary:
8 Buy, 13 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 28 | New: 14
Rating Summary:
8 Buy, 13 Hold, 3 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 13 | Down: 28 | New: 14
Trade KEY Now!
Deutsche Bank downgraded KeyCorp (NYSE: KEY) from Buy to Hold with a price target of $9.00.
"EPS should benefit from the recently announced cost savings plan, Basel 3 capital is the highest among peers, and the stock trades at 0.95x tangible book. However, KEY is among the most exposed to higher RMBS prepays/lower reinvestment rates and may be more exposed to C&I pricing pressures given more C&I concentration and its focus on larger loans (the area we expect to experience the most pricing pressure)," analyst Matt O'Connor comments. "While KEY has more leverage to declining funding costs vs. peers (deposit rates are 20bps higher and other borrowing costs are 40bps higher - see p. 29), we think this is already in estimates. Lastly, there’s little benefit from strong mortgage as KEY doesn’t originate them."
For an analyst ratings summary and ratings history on KeyCorp click here. For more ratings news on KeyCorp click here.
Shares of KeyCorp closed at $8.88 yesterday, with a 52 week range of $6.11-$9.12.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
"EPS should benefit from the recently announced cost savings plan, Basel 3 capital is the highest among peers, and the stock trades at 0.95x tangible book. However, KEY is among the most exposed to higher RMBS prepays/lower reinvestment rates and may be more exposed to C&I pricing pressures given more C&I concentration and its focus on larger loans (the area we expect to experience the most pricing pressure)," analyst Matt O'Connor comments. "While KEY has more leverage to declining funding costs vs. peers (deposit rates are 20bps higher and other borrowing costs are 40bps higher - see p. 29), we think this is already in estimates. Lastly, there’s little benefit from strong mortgage as KEY doesn’t originate them."
For an analyst ratings summary and ratings history on KeyCorp click here. For more ratings news on KeyCorp click here.
Shares of KeyCorp closed at $8.88 yesterday, with a 52 week range of $6.11-$9.12.
Join StreetInsider.com FREE and get immediately alerted when news breaks on your stocks and other market items - JOIN NOW
*NEW - Download StreetInsider's FREE iPhone and iPad App - Click Here
You May Also Be Interested In
- UPDATE: Exane BNP Paribas Downgrades BlackBerry (BBRY) to Underperform; Analyst Says Profit 'Drying Up'
- Benchmark Boosts PT on R.R. Donnelley (RRD)
- HSBC Downgrades Carnival Corporation (CCL) to Neutral
Create E-mail Alert Related Categories
DowngradesRelated Entities
Deutsche Bank
Login with Facebook
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
