Today we're going to take a look at the well-established KeyCorp (NYSE:KEY). The company's stock saw significant share price movement during recent months on the NYSE, rising to highs of $18.54 and falling to the lows of $15.97. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether KeyCorp's current trading price of $16.2 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at KeyCorp’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Is KeyCorp still cheap?
Great news for investors – KeyCorp is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $25.42, but it is currently trading at US$16.20 on the share market, meaning that there is still an opportunity to buy now. What’s more interesting is that, KeyCorp’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
What kind of growth will KeyCorp generate?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Though in the case of KeyCorp, it is expected to deliver a relatively unexciting earnings growth of 8.6%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.
What this means for you:
Are you a shareholder? Even though growth is relatively muted, since KEY is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor? If you’ve been keeping an eye on KEY for a while, now might be the time to make a leap. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy KEY. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on KeyCorp. You can find everything you need to know about KeyCorp in the latest infographic research report. If you are no longer interested in KeyCorp, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.