Reviewing KeyCorp (NYSE:KEY) & Simmons First National (NASDAQ:SFNC)

Simmons First National (NASDAQ:SFNC) and KeyCorp (NYSE:KEY) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their risk, analyst recommendations, institutional ownership, earnings, valuation, dividends and profitability.

Earnings & Valuation

This table compares Simmons First National and KeyCorp”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Simmons First National	$1.37 billion	1.95	$175.06 million	$1.33	15.95
KeyCorp	$10.40 billion	1.47	$967.00 million	$0.79	20.56

KeyCorp has higher revenue and earnings than Simmons First National. Simmons First National is trading at a lower price-to-earnings ratio than KeyCorp, indicating that it is currently the more affordable of the two stocks.

Dividends

Simmons First National pays an annual dividend of $0.84 per share and has a dividend yield of 4.0%. KeyCorp pays an annual dividend of $0.82 per share and has a dividend yield of 5.0%. Simmons First National pays out 63.2% of its earnings in the form of a dividend. KeyCorp pays out 103.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Simmons First National has raised its dividend for 13 consecutive years and KeyCorp has raised its dividend for 13 consecutive years.

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Simmons First National and KeyCorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Simmons First National	1	3	0	0	1.75
KeyCorp	0	7	11	0	2.61

Simmons First National presently has a consensus target price of $21.75, indicating a potential upside of 2.50%. KeyCorp has a consensus target price of $16.71, indicating a potential upside of 2.87%. Given KeyCorp’s stronger consensus rating and higher probable upside, analysts plainly believe KeyCorp is more favorable than Simmons First National.

Risk & Volatility

Simmons First National has a beta of 0.87, suggesting that its share price is 13% less volatile than the S&P 500. Comparatively, KeyCorp has a beta of 1.25, suggesting that its share price is 25% more volatile than the S&P 500.

Profitability

This table compares Simmons First National and KeyCorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Simmons First National	10.49%	5.33%	0.66%
KeyCorp	7.35%	8.64%	0.54%

Insider & Institutional Ownership

27.6% of Simmons First National shares are owned by institutional investors. Comparatively, 79.7% of KeyCorp shares are owned by institutional investors. 1.9% of Simmons First National shares are owned by insiders. Comparatively, 0.6% of KeyCorp shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Summary

KeyCorp beats Simmons First National on 10 of the 16 factors compared between the two stocks.

About Simmons First National

Simmons First National Corporation operates as the holding company for Simmons Bank that provides banking and other financial products and services to individuals and businesses. The company offers checking, savings, and time deposits; consumer, real estate, and commercial loans; agricultural finance, equipment, and small business administration lending; trust and fiduciary services; credit cards; investment management products; treasury management; insurance products; and securities and investment services. It also provides ATM services; Internet and mobile banking platforms; overdraft facilities; and safe deposit boxes. The company was founded in 1903 and is headquartered in Pine Bluff, Arkansas.

About KeyCorp

KeyCorp operates as the holding company for KeyBank National Association that provides various retail and commercial banking products and services in the United States. It operates in two segments, Consumer Bank and Commercial Bank. The company offers various deposits, investment products and services; commercial leasing, investment management, consumer finance; and personal finance and financial wellness, student loan refinancing, mortgage and home equity, lending, credit card, treasury, business advisory, wealth management, asset management, cash management, portfolio management, and trust and related services to individuals and small and medium-sized businesses. It also provides 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 to consumer, energy, healthcare, industrial, public sector, real estate, and technology sectors for middle market clients. In addition, the company offers community development financing, securities underwriting, brokerage, and investment banking services. The company was founded in 1849 and is headquartered in Cleveland, Ohio.