Banks - Regional · NYSE
Current Price
$21.67
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on KeyCorp with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
KeyCorp operates as the holding company for KeyBank National Association that provides various retail and commercial banking products and services in the United States. It operates in two segments, Consumer Bank and Commercial Bank. The company offers various deposits, investment products and services; and personal finance and financial wellness, student loan refinancing, mortgage and home equity, lending, credit card, treasury, business advisory, wealth management, asset management, investment, cash management, portfolio management, and trust and related services to individuals and small and medium-sized businesses. It also provides a suite of banking and capital market products, such as syndicated finance, debt and equity capital market products, commercial payments, equipment finance, commercial mortgage banking, derivatives, foreign exchange, financial advisory, and public finance, as well as commercial mortgage loans comprising consumer, energy, healthcare, industrial, public sector, real estate, and technology loans for middle market clients. In addition, the company offers community development financing, securities underwriting, brokerage, and investment banking services. As of December 31, 2021, it operated through a network of approximately 999 branches and 1,317 ATMs in 15 states, as well as additional offices, online and mobile banking capabilities, and a telephone banking call center. KeyCorp was founded in 1849 and is headquartered in Cleveland, Ohio.
ROIC (TTM)
4.8%
ROE (TTM)
9.7%
FCF Yield
8.92%
Based on trailing twelve-month data, KEY shows a free cash flow per share of N/A and a ROIC of 4.8%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 8.92% are important context metrics when evaluating KEY's stock valuation relative to peers.
The intrinsic value of KEY depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether KEY is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $21.67. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on KeyCorp: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Banks - Regional industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting KEY's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For KeyCorp, this means projecting how much free cash flow the Banks - Regional will produce over the next 5-10 years, then discounting those amounts to today's dollars. KEY's ROIC of 4.8% suggests the company may face challenges generating returns above its cost of capital.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For KEY, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
