Is KeyCorp Stock a Buy?
These have not been the best of times for the banking industry. The average bank stock is down about 39% year to date, and the vast majority have suffered steep earnings losses in the first quarter. Cleveland-based KeyCorp (NYSE: KEY), which owns KeyBank, is no exception.
In the first quarter, the company's net income plummeted 69% year over year to $118 million. Earnings per share (EPS) fell 68% to $0.12. Those declines largely stemmed from KeyCorp's move to boost its credit loss provision by $359 million in anticipation of a surge in loan defaults due to the COVID-19 pandemic -- 479% more than it set aside to cover such losses in Q1 2019. This was not unusual in the industry, as most banks' bottom lines have taken a hit as they prepare for significantly higher credit losses.
In short, KeyCorp's latest headline numbers donʻt look good. But if you look beyond them, you will find that the bank is a solid value right now. Hereʻs why.
Source Fool.com
