KeyCorp (NYSE:KEY) is one of the largest bank-based financial services companies in the U.S., with assets of $89 billion. After doing well in the second round of “stress tests,” the bank announced a $625 million equity capital raise and a payback of its $2.5 billion in TARP funds, which saves at least $125 million in preferred dividend payments.
S&P expects KEY to report earnings of 82 cents per share in 2012 and 85 cents in 2013. At a price-earnings ratio of 12.2 times 82 cents in earnings, S&P’s target is $10 per share.
Click to EnlargeTechnically, KEY broke to a bull market on Dec. 20 at $7.37, then punched through a double top at $8.50, and has now confirmed a break from a cup and handle formation. The Trade of the Day first recommended KeyCorp on Feb. 29 at $8.28 with a target of $9.50. My target is being increased to $11 based on the recent chart action: Yesterday KEY was up in a down market.