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10 Big Bank Stocks Gearing Up for Third-Quarter Earnings (Update 3)

7. KeyCorp
Shares of KeyCorp of Cleveland closed at $8.81 Friday, returning 16% year-to-date, following a 12% decline last year.

The shares trade just below tangible book value, and for 10.2 times the consensus 2013 EPS estimate of 86 cents. The consensus 2012 EPS estimate is 85 cents.

Based on a quarterly payout of five cents, the shares have a dividend yield of 2.27%.

For the 12-month period ended June 30, the company's ROA was 1.06%, while its ROE was 8.46%.

The consensus among analysts is for KeyCorp to report third-quarter earnings of 21 cents a share, down from 24 cents the previous quarter, and 22 cents a year earlier.

KeyCorp is well-positioned in the wake of the Federal Reserve's latest move to push long-term rates even lower, as the company has already felt the bulk of its pain from asset repricing. The company's second-quarter net interest margin narrowed to 3.06%, from 3.16% the previous quarter, and 3.19% a year earlier.

Credit Suisse analyst Craig Siegenthaler has a neutral rating on KeyCorp, with a $9 price target, saying last month that "We look for 3Q12 and 4Q12 EPS to beat market expectations, and believe investors will increase EPS estimates for 2013/2014" before the end of the year.

Siegenthaler expects KeyCorp's core net interest margin (NIM) "to experience the largest improvement in the industry given (1) significant debt retirement and refi activity since June, (2) significant CD repricing in 3Q12," and the acquisition of $725 million in Key-branded credit card assets from Elan Financial Services, taking on about 400,000 consumer and business accounts.

KEY Chart KEY data by YCharts

Interested in more on KeyCorp? See TheStreet Ratings' report card for this stock.

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