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Yum Brands Inc YUM

Morningstar Rating
$137.33 +2.10 (1.55%)
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Company Report

Yum Brands' Digital Capabilities and Unit Development Narrative Position Operator for Share Gains

The restaurant industry has changed a lot over the past three years. We remain encouraged by the ability of the largest operators, including Yum Brands, to accelerate critical investments in e-commerce platforms, delivery integration, and technological solutions that meet the demands of the modern restaurant consumer. Recent acquisitions demonstrate the emphasis the firm has placed on digital enhancements, with 45% of systemwide sales now coming through digital channels, which we expect to remain integral to Yum's strategic playbook.

Price vs Fair Value

YUM is trading at a 1% discount.
Price
$137.33
Fair Value
$653.00
Uncertainty
Low
1-Star Price
$359.15
5-Star Price
$119.10
Economic Moat
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Capital Allocation
Zqbxhdw

Bulls Say, Bears Say

Bulls

Better-than-expected international portability in the Taco Bell segment could offer upside from management's 5% average annual unit growth target.

Bears

Difficulties repositioning the menu could pressure Yum's restaurants' value propositions as consumers demand healthier choices.

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News

Trading Information

Previous Close Price
$135.23
Day Range
$134.97137.72
52-Week Range
$115.53143.25
Bid/Ask
$135.31 / $138.11
Market Cap
$38.64 Bil
Volume/Avg
2.3 Mil / 1.7 Mil

Key Statistics

Price/Earnings (Normalized)
25.78
Price/Sales
5.40
Dividend Yield (Trailing)
1.81%
Dividend Yield (Forward)
1.95%
Total Yield
1.94%

Company Profile

Yum Brands is a U.S.-based restaurant operator featuring a portfolio of four brands: KFC (29,900 global units at year-end 2023), Pizza Hut (19,866 units), Taco Bell (8,564 units), and The Habit Burger Grill (381 units). With $64 billion in 2023 systemwide sales, the firm is the second-largest restaurant company in the world behind McDonald’s ($130 billion), ahead of Restaurant Brands International and Starbucks ($29 billion). Yum is 98% franchised, with the largest franchisee, Yum China, spun out in 2016 (after which Yum China agreed to pay 3% royalties to Yum Brands in perpetuity). Yum is the newest evolution of Tricon, formerly a division of PepsiCo, and generates the bulk of its revenue from franchise royalties and marketing contributions.
Sector
Consumer Cyclical
Industry
Restaurants
Stock Style Box
Mid Core
Total Number of Employees
35,000

Competitors

Valuation

Metric
YUM
QSR
MCD
Price/Earnings (Normalized)
25.7823.9624.89
Price/Book Value
8.52
Price/Sales
5.404.998.28
Price/Cash Flow
22.5522.4421.71
Price/Earnings
YUM
QSR
MCD

Financial Strength

Metric
YUM
QSR
MCD
Quick Ratio
0.990.881.03
Current Ratio
1.261.011.16
Interest Coverage
4.543.378.60
Quick Ratio
YUM
QSR
MCD

Profitability

Metric
YUM
QSR
MCD
Return on Assets (Normalized)
24.79%6.44%16.74%
Return on Equity (Normalized)
54.01%
Return on Invested Capital (Normalized)
55.35%9.94%21.67%
Return on Assets
YUM
QSR
MCD
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Restaurants Industry Comparables

Ticker
Name
Morningstar Rating for Stocks
Economic Moat
Market Cap
MCD
McDonald's CorpCjrt$213.7 Bil
SBUX
Starbucks CorpHksv$108.4 Bil
CMG
Chipotle Mexican Grill IncLbxm$72.0 Bil
CMPGY
Compass Group PLC ADRVmrsvv$47.5 Bil
QSR
Restaurant Brands International IncDxzkv$23.5 Bil
DRI
Darden Restaurants IncVyljyz$20.1 Bil
YUMC
Yum China Holdings IncYvn$16.8 Bil
DPZ
Domino's Pizza IncGny$14.9 Bil
WING
Wingstop IncBrgzqmt$9.8 Bil

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