Is KeyCorp overvalued or undervalued?

As of 3 October 2025, the valuation grade for KeyCorp has moved from very expensive to expensive, indicating a slight improvement but still suggesting that the stock is not attractively priced. The company appears overvalued based on its current metrics, with a P/E ratio of 926, significantly higher than its peers like Huntington Bancshares, Inc. at 12.37 and Regions Financial Corp. at 12.07. Additionally, KeyCorp's Price to Book Value stands at 1.17, while its EV to Capital Employed is 1.23, both of which suggest that the stock is trading at a premium compared to its book value and capital efficiency.
In terms of performance, KeyCorp has underperformed relative to the S&P 500 over the past week and month, with returns of -1.38% and -1.69%, respectively, while the S&P 500 gained 1.09% and 4.15%. However, the year-to-date return of 8.69% shows some resilience, although it still lags behind the S&P 500's 14.18% return. Overall, the combination of high valuation ratios and recent underperformance suggests that KeyCorp is not a compelling investment at its current price level.