Comparing Nicolet Bankshares (NCBS) & KeyCorp (KEY)

Nicolet Bankshares (NASDAQ:NCBS) and KeyCorp (NYSE:KEY) are both finance companies, but which is the better investment? We will contrast the two businesses based on the strength of their dividends, profitability, risk, earnings, analyst recommendations, institutional ownership and valuation.

Institutional & Insider Ownership

32.6% of Nicolet Bankshares shares are held by institutional investors. Comparatively, 79.4% of KeyCorp shares are held by institutional investors. 16.4% of Nicolet Bankshares shares are held by company insiders. Comparatively, 0.7% of KeyCorp shares are held by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Dividends

KeyCorp pays an annual dividend of $0.68 per share and has a dividend yield of 3.4%. Nicolet Bankshares does not pay a dividend. KeyCorp pays out 50.0% of its earnings in the form of a dividend. KeyCorp has raised its dividend for 7 consecutive years.

Profitability

This table compares Nicolet Bankshares and KeyCorp’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Nicolet Bankshares 24.13% 10.62% 1.30%
KeyCorp 20.05% 11.73% 1.20%

Earnings and Valuation

This table compares Nicolet Bankshares and KeyCorp’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Nicolet Bankshares $143.89 million 3.63 $33.15 million $3.42 15.83
KeyCorp $6.87 billion 3.07 $1.30 billion $1.36 14.72

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

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Nicolet Bankshares and KeyCorp, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Nicolet Bankshares 0 4 1 0 2.20
KeyCorp 1 4 14 0 2.68

Nicolet Bankshares presently has a consensus target price of $60.10, indicating a potential upside of 11.03%. KeyCorp has a consensus target price of $23.31, indicating a potential upside of 16.45%. Given KeyCorp’s stronger consensus rating and higher possible upside, analysts plainly believe KeyCorp is more favorable than Nicolet Bankshares.

Volatility and Risk

Nicolet Bankshares has a beta of 0.88, suggesting that its share price is 12% less volatile than the S&P 500. Comparatively, KeyCorp has a beta of 0.98, suggesting that its share price is 2% less volatile than the S&P 500.

Summary

KeyCorp beats Nicolet Bankshares on 10 of the 17 factors compared between the two stocks.

About Nicolet Bankshares

Nicolet Bankshares, Inc. operates as the holding company for Nicolet National Bank that provides commercial and retail banking services for businesses and individuals. The company accepts checking, savings, and money market accounts; various certificates of deposit; and individual retirement accounts. It also offers commercial loans, including commercial, industrial, and business loans and lines of credit; owner-occupied commercial real estate loans; agricultural (AG) production and AG real estate loans; commercial real estate investment real estate loans; construction and land development loans; residential real estate loans, such as residential first lien mortgages, junior lien mortgages, home equity loans, lines of credit, and residential construction loans; and consumer loans. In addition, the company provides cash management, international banking, personal brokerage, safe deposit boxes, and trust and fiduciary, as well as wealth management and retirement plan services. Further, it offers mortgage refinancing; online services, such as commercial, retail, and trust online banking; automated bill payment, mobile banking deposits and account access, remote deposit capture, and telephone banking services; and other services consisting of wire transfers, debit cards, credit cards, pre-paid gift cards, direct deposits, official bank checks. Additionally, the company provides investment strategy and transactional services to financial institutions. As of December 31, 2017, it operated 38 branches located in northeast and central Wisconsin, as well as in Menominee, Michigan. The company was formerly known as Green Bay Financial Corporation and changed its name to Nicolet Bankshares, Inc. in March 2002. Nicolet Bankshares, Inc. was founded in 2000 and is headquartered in Green Bay, Wisconsin.

About KeyCorp

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.

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