KeyCorp Stock Unlocks Analyst Bear Notes

Citigroup lowered its price target as well

Assistant Editor
Oct 26, 2020 at 10:49 AM
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After being hit with a couple bear notes this morning, the shares of KeyCorp (NYSE:KEY) are down 3.4% at $13 at last check. Wedbush removed the stock from its "best ideas" list, downgrading it to "neutral" from "outperform," due to foreseeable revenue headwinds. Citigroup chimed in as well, lowering its price target to $14 from $15. 

On the charts, KEY's highest rallies since late June, including Friday's trading session, have found a ceiling at $13.50. Now the equity is once again contending with its 200-day moving average, which it briefly toppled for the first time since late-February on Friday. Now, the bank stock is down 35.2% year-to-date. 

Coming into today, a majority of analysts were already hesitant on KeyCorp stock, with 11 of the 15 in coverage sporting a "hold" or worse rating. Meanwhile, the 12-month consensus price target of $13.85 is a 5% premium to current levels. 

The options pits are seeing similar sentiment. Though calls are just barely outweighing puts on an overall basis, KEY's 10-day put/call volume ratio of 0.94 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) stands higher than 72% of readings from this past year. This suggests that puts are being picked up at a faster-than-usual rate in comparison to the last 12 months. 

That said, speculating on KeyCorp stock's next move with options could be a prudent play. The security's Schaeffer's Volatility Index (SVI) of 46% stands higher than just 16% of all other readings in its annual range, implying that options players are pricing in relatively low volatility expectations at the moment. 

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