** U.S. lender KeyCorp's KEY.N shares rise 1.9% to $11.85 premarket

** Brokerage Piper Sandler upgrades company's shares to "overweight" from ""; raises PT to $13.50 from $12

** New PT implies an upside of ~16% to stock's last close

** "With funding issues beginning to move to the rear-view, we are becoming more comfortable with KEY's interest income (NII) trajectory" - Piper Sandler

** Brokerage says while KEY stock has begun to recover it remains among the worst YTD performers in its coverage list; Adds company is well-positioned to benefit from an investment banking recovery

** 12 of 22 brokerages rate the stock "buy" or higher, 8 "hold", and 2 "strong sell"; median PT $13 - LSEG data

** As of last close, stock down 33.1% YTD

(Reporting by Manya Saini in Bengaluru)

((Manya.Saini@thomsonreuters.com))