KeyCorp (KEY) Stock Forecast & Price Target

KeyCorp's financial performance demonstrates a solid growth trajectory, with investment banking revenues increasing approximately 19% to $353 million over the past six months, indicating strong client demand in capital markets despite muted middle market M&A volumes. Net interest income grew by 3.7% quarter-over-quarter to $1.193 billion, supported by a 9 basis point increase in the net interest margin to 2.75%, reflecting effective balance sheet management. Additionally, the tangible common equity (TCE) ratio rose to 8.06%, and the common equity tier 1 (CET1) ratio improved to 10.3%, suggesting robust capital positions and lending growth prospects.

KeyCorp has experienced notable declines in key lending segments, with significant reductions in Consumer, Commercial Real Estate (CRE), and lease financing, resulting in overall revenue adjustments. Furthermore, a revised revenue forecast for 2026 now projects a decline in average loan growth and fee income, reflecting a slowdown in operational momentum. Although the company's capital levels remain robust, concerns regarding a potential recession in 2026, which could precipitate increased credit losses and lower profitability, further contribute to a negative outlook on KeyCorp’s stock.