The firm also lowered its price target to $13 from $14.50 on shares of the Cleveland-based bank holding company.
Piper believes the shares will have a difficult time outperforming peers as estimates continue to move lower over the next few months, the Fly noted.
Additionally, expectations are too high moving into the "noisy" second half of the year, the firm said.
Shares of KeyCorp were edging higher at the start of trading on Monday.
Separately, TheStreet Ratings Team has a "Buy" rating with a score of B- on the stock.
The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins and attractive valuation levels.
The team believes its strengths outweigh the fact that the company has had sub par growth in net income.
Recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: KEY