Financial Review: KeyCorp (KEY) versus SouthCrest Financial Group (SCSG)

KeyCorp (OTCMKTS: SCSG) and SouthCrest Financial Group (OTCMKTS:SCSG) are both finance companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, earnings, analyst recommendations, valuation, profitability and risk.

Insider & Institutional Ownership

79.4% of KeyCorp shares are owned by institutional investors. Comparatively, 5.1% of SouthCrest Financial Group shares are owned by institutional investors. 0.7% of KeyCorp shares are owned by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Volatility & Risk

KeyCorp has a beta of 0.98, meaning that its stock price is 2% less volatile than the S&P 500. Comparatively, SouthCrest Financial Group has a beta of 0.22, meaning that its stock price is 78% less volatile than the S&P 500.

Dividends

KeyCorp pays an annual dividend of $0.68 per share and has a dividend yield of 3.3%. SouthCrest Financial Group pays an annual dividend of $0.12 per share and has a dividend yield of 1.2%. KeyCorp pays out 50.0% of its earnings in the form of a dividend. KeyCorp has increased its dividend for 7 consecutive years. KeyCorp is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.

Analyst Ratings

This is a summary of recent ratings and target prices for KeyCorp and SouthCrest Financial Group, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
KeyCorp 1 4 15 0 2.70
SouthCrest Financial Group 0 0 0 0 N/A

KeyCorp currently has a consensus price target of $23.24, indicating a potential upside of 11.98%. Given KeyCorp’s higher possible upside, analysts clearly believe KeyCorp is more favorable than SouthCrest Financial Group.

Valuation & Earnings

This table compares KeyCorp and SouthCrest Financial Group’s top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
KeyCorp $6.87 billion 3.18 $1.30 billion $1.36 15.26
SouthCrest Financial Group $24.75 million 2.58 $13.66 million N/A N/A

KeyCorp has higher revenue and earnings than SouthCrest Financial Group.

Profitability

This table compares KeyCorp and SouthCrest Financial Group’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
KeyCorp 20.05% 11.73% 1.20%
SouthCrest Financial Group N/A N/A N/A

Summary

KeyCorp beats SouthCrest Financial Group on 13 of the 15 factors compared between the two stocks.

KeyCorp Company Profile

KeyCorp operates as the holding company for KeyBank National Association that provides various retail and commercial banking services in the United States. The company's Key Community Bank segment offers various deposit and investment products, personal finance services, residential mortgages, home equity loans, credit cards, and installment loans, as well as personal property and casualty insurance, such as home, auto, renters, watercraft, and umbrella insurance for individuals. It also purchases retail auto sales contracts through a network of auto dealership; offers financial, estate and retirement planning, asset management, and trust services, as well as portfolio management, life insurance, charitable giving, and related services for high-net-worth clients. In addition, this segment provides deposits, investment and credit products, and business advisory services to small businesses; and commercial lending, cash management, equipment leasing, investment, and commercial property and casualty insurance products, as well as employee benefit programs, succession planning, capital market access, derivatives, and foreign exchange services to mid-sized businesses. Its Key Corporate Bank segment offers a suite of banking and capital market products, such as syndicated finance, debt and equity capital market products, commercial payments, equipment finance, commercial mortgage banking, derivatives, foreign exchange, financial advisory, and public finance, as well as commercial mortgage loans for middle market clients comprising consumer, energy, healthcare, industrial, public, real estate, and technology sectors. As of December 31, 2017, the company offered its products and services through 1,197 retail banking branches and 1,572 automated teller machines in 15 states, as well as additional offices, online and mobile banking capabilities, and a telephone banking call center. KeyCorp was founded in 1849 and is headquartered in Cleveland, Ohio.

SouthCrest Financial Group Company Profile

SouthCrest Financial Group, Inc. operates as the bank holding company for SouthCrest Bank, N.A. that provides banking services. The company accepts checking, savings, and money market accounts; and certificates of deposit. Its loan products include personal loans for cars, boats, recreational vehicles, and other purchases; home equity lines of credit; loans on investment properties; owner occupied real estate, construction and development, equipment and inventory, practice, and Georgia entertainment tax credit financing; construction to permanent, investment real estate, and acquisition and development loans; and working capital and lines of credit. The company also offers credit and debit cards; remote deposit capture, positive pay, ACH, online wires, merchant, business payroll, and reorder checks services; and online banking, online bill pay, mobile banking and deposit, telephone banking, and ATM services. It serves retail, private, entrepreneurial, high-net-worth, and commercial customers. As of April 26, 2018, the company operated through 9 branches in Georgia. SouthCrest Financial Group, Inc. was founded in 1910 and is headquartered in Atlanta, Georgia.

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