Reviewing Park National (NYSE:PRK) & KeyCorp (NYSE:KEY)

Park National (NYSE:PRK) and KeyCorp (NYSE:KEY) are both finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their profitability, risk, earnings, dividends, valuation, analyst recommendations and institutional ownership.

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Park National	23.46%	12.31%	1.50%
KeyCorp	17.83%	11.23%	1.05%

Earnings & Valuation

This table compares Park National and KeyCorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Park National	$623.80 million	5.52	$151.42 million	$11.17	17.07
KeyCorp	$11.23 billion	2.07	$1.83 billion	$1.72	12.66

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

Institutional and Insider Ownership

62.7% of Park National shares are held by institutional investors. Comparatively, 79.7% of KeyCorp shares are held by institutional investors. 2.2% of Park National shares are held by insiders. Comparatively, 0.6% of KeyCorp shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations and price targets for Park National and KeyCorp, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Park National	0	4	0	0	2.00
KeyCorp	0	7	12	1	2.70

Park National presently has a consensus target price of $211.00, suggesting a potential upside of 10.63%. KeyCorp has a consensus target price of $49.14, suggesting a potential upside of 125.58%. Given KeyCorp’s stronger consensus rating and higher possible upside, analysts clearly believe KeyCorp is more favorable than Park National.

Risk & Volatility

Park National has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500. Comparatively, KeyCorp has a beta of 1.02, meaning that its share price is 2% more volatile than the S&P 500.

Dividends

Park National pays an annual dividend of $4.40 per share and has a dividend yield of 2.3%. KeyCorp pays an annual dividend of $0.82 per share and has a dividend yield of 3.8%. Park National pays out 39.4% of its earnings in the form of a dividend. KeyCorp pays out 47.7% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Park National has raised its dividend for 8 consecutive years.

About Park National

Park National Corporation operates as the bank holding company for Park National Bank that provides commercial banking and trust services in small and medium population areas. The company offers deposits for demand, savings, and time accounts; trust and wealth management services; cash management services; safe deposit operations; electronic funds transfers; Internet and mobile banking solutions with bill pay service; credit cards; and various additional banking-related services. It also provides commercial loans, including financing for industrial and commercial properties, financing for equipment, inventory and accounts receivable, acquisition financing, and commercial leasing, as well as for consumer finance companies; commercial real estate loans comprising mortgage loans to developers and owners of commercial real estate; originates financing leases primarily for the purchase of commercial vehicles, operating/manufacturing equipment, and municipal vehicles/equipment; consumer loans, such as automobile loans; consumer finance services; home equity lines of credit; and residential real estate and construction loans, as well as installment loans and commercial loans. In addition, the company offers aircraft financing services; and ParkDirect, a personal banking application. Park National Corporation was founded in 1908 and is headquartered in Newark, Ohio.

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.