Analyst Ebrahim Poonawala from Bank of America Securities reiterated a Buy rating on KeyCorp and increased the price target to $21.00 from $20.00.
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Ebrahim Poonawala has given his Buy rating due to a combination of factors, including KeyCorp’s strong revenue growth and improved financial outlook. The company reported better-than-expected earnings, driven by a significant increase in investment banking fees and stronger loan growth. This positive performance led to an upward revision in their full-year guidance, particularly in net interest income, which is expected to grow by 20-22% due to improved net interest margins.
Furthermore, management’s optimistic outlook on capital expenditure and client activity supports the potential for continued growth. The bank’s capital position remains robust, with plans for modest share repurchases, providing flexibility for strategic acquisitions. The stock’s valuation, trading at a favorable price-to-earnings ratio, combined with expected earnings growth and improved return metrics, presents a compelling risk/reward opportunity for investors.
Poonawala covers the Financial sector, focusing on stocks such as JPMorgan Chase, Goldman Sachs Group, and Fifth Third Bancorp. According to TipRanks, Poonawala has an average return of 13.9% and a 72.75% success rate on recommended stocks.
In another report released on July 9, KBW also maintained a Buy rating on the stock with a $20.50 price target.