YUM! BRANDS INC (YUM) Stock Fundamental Analysis
NYSE:YUM - New York Stock Exchange, Inc. - US9884981013 - Common Stock - Currency: USD
Taking everything into account, YUM scores 5 out of 10 in our fundamental rating. YUM was compared to 134 industry peers in the Hotels, Restaurants & Leisure industry. YUM has an excellent profitability rating, but there are some minor concerns on its financial health. YUM is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year YUM was profitable.
YUM had a positive operating cash flow in the past year.
YUM had positive earnings in each of the past 5 years.
YUM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
YUM has a better Return On Assets (23.62%) than 98.47% of its industry peers.
YUM has a better Return On Invested Capital (37.26%) than 97.71% of its industry peers.
The Average Return On Invested Capital over the past 3 years for YUM is significantly above the industry average of 10.55%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.62% | ||
| ROE | N/A | ||
| ROIC | 37.26% |
ROA(3y)24.9%
ROA(5y)22.98%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)40.71%
ROIC(5y)39.66%
1.3 Margins
The Profit Margin of YUM (21.13%) is better than 95.42% of its industry peers.
In the last couple of years the Profit Margin of YUM has declined.
With an excellent Operating Margin value of 32.48%, YUM belongs to the best of the industry, outperforming 98.47% of the companies in the same industry.
In the last couple of years the Operating Margin of YUM has remained more or less at the same level.
YUM's Gross Margin of 48.57% is in line compared to the rest of the industry. YUM outperforms 50.38% of its industry peers.
In the last couple of years the Gross Margin of YUM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 32.48% | ||
| PM (TTM) | 21.13% | ||
| GM | 48.57% |
OM growth 3Y3.97%
OM growth 5Y1.1%
PM growth 3Y12.16%
PM growth 5Y-3.6%
GM growth 3Y1.29%
GM growth 5Y1.12%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), YUM is creating value.
YUM has more shares outstanding than it did 1 year ago.
The number of shares outstanding for YUM has been reduced compared to 5 years ago.
The debt/assets ratio for YUM has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.33 indicates that YUM is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.33, YUM is in the better half of the industry, outperforming 64.12% of the companies in the same industry.
YUM has a debt to FCF ratio of 8.19. This is a slightly negative value and a sign of low solvency as YUM would need 8.19 years to pay back of all of its debts.
YUM has a better Debt to FCF ratio (8.19) than 63.36% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 8.19 | ||
| Altman-Z | 2.33 |
ROIC/WACC4.7
WACC7.92%
2.3 Liquidity
A Current Ratio of 1.37 indicates that YUM should not have too much problems paying its short term obligations.
YUM has a better Current ratio (1.37) than 66.41% of its industry peers.
A Quick Ratio of 1.37 indicates that YUM should not have too much problems paying its short term obligations.
YUM has a Quick ratio of 1.37. This is in the better half of the industry: YUM outperforms 69.47% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.37 |
3. Growth
3.1 Past
The earnings per share for YUM have decreased by -1.72% in the last year.
The Earnings Per Share has been growing by 10.35% on average over the past years. This is quite good.
Looking at the last year, YUM shows a small growth in Revenue. The Revenue has grown by 2.32% in the last year.
YUM shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.46% yearly.
EPS 1Y (TTM)-1.72%
EPS 3Y12.61%
EPS 5Y10.35%
EPS Q2Q%-4.86%
Revenue 1Y (TTM)2.32%
Revenue growth 3Y7.78%
Revenue growth 5Y4.46%
Sales Q2Q%6.91%
3.2 Future
The Earnings Per Share is expected to grow by 10.84% on average over the next years. This is quite good.
YUM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.79% yearly.
EPS Next Y7.05%
EPS Next 2Y8.96%
EPS Next 3Y9.78%
EPS Next 5Y10.84%
Revenue Next Year5.49%
Revenue Next 2Y6.04%
Revenue Next 3Y6.15%
Revenue Next 5Y6.79%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
YUM is valuated quite expensively with a Price/Earnings ratio of 25.27.
Based on the Price/Earnings ratio, YUM is valued a bit cheaper than 61.83% of the companies in the same industry.
YUM is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.42, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 21.12 indicates a rather expensive valuation of YUM.
Based on the Price/Forward Earnings ratio, YUM is valued a bit cheaper than the industry average as 64.12% of the companies are valued more expensively.
YUM's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.27 | ||
| Fwd PE | 21.12 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, YUM is valued a bit more expensive than 63.36% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, YUM is valued a bit cheaper than 68.70% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 26.47 | ||
| EV/EBITDA | 18.54 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
YUM has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.58
PEG (5Y)2.44
EPS Next 2Y8.96%
EPS Next 3Y9.78%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.11%, YUM has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 2.89, YUM pays a better dividend. On top of this YUM pays more dividend than 80.92% of the companies listed in the same industry.
YUM's Dividend Yield is comparable with the S&P500 average which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.11% |
5.2 History
On average, the dividend of YUM grows each year by 10.79%, which is quite nice.
YUM has paid a dividend for at least 10 years, which is a reliable track record.
As YUM did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)10.79%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
YUM pays out 48.17% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of YUM is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP48.17%
EPS Next 2Y8.96%
EPS Next 3Y9.78%
YUM! BRANDS INC
NYSE:YUM (1/29/2025, 2:55:49 PM)
129.66
+0.42 (+0.32%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners87.42%
Inst Owner Change-0.16%
Ins Owners0.14%
Ins Owner Change-2.09%
Market Cap36.18B
Analysts70.59
Price Target147.09 (13.44%)
Short Float %2.16%
Short Ratio3.33
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.11% |
Yearly Dividend2.42
Dividend Growth(5Y)10.79%
DP48.17%
Div Incr Years6
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.73%
Min EPS beat(2)-4.11%
Max EPS beat(2)0.66%
EPS beat(4)1
Avg EPS beat(4)-4.98%
Min EPS beat(4)-11.06%
Max EPS beat(4)0.66%
EPS beat(8)4
Avg EPS beat(8)0.03%
EPS beat(12)4
Avg EPS beat(12)-1.74%
EPS beat(16)8
Avg EPS beat(16)2.88%
Revenue beat(2)0
Avg Revenue beat(2)-4.02%
Min Revenue beat(2)-4.8%
Max Revenue beat(2)-3.24%
Revenue beat(4)0
Avg Revenue beat(4)-4.95%
Min Revenue beat(4)-7.47%
Max Revenue beat(4)-3.24%
Revenue beat(8)2
Avg Revenue beat(8)-3.02%
Revenue beat(12)2
Avg Revenue beat(12)-2.49%
Revenue beat(16)5
Avg Revenue beat(16)-1.35%
PT rev (1m)0.21%
PT rev (3m)-1.48%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-7.29%
EPS NY rev (1m)0%
EPS NY rev (3m)-2.91%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.57%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)-1.5%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.27 | ||
| Fwd PE | 21.12 | ||
| P/S | 5.01 | ||
| P/FCF | 26.47 | ||
| P/OCF | 22.28 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 18.54 |
EPS(TTM)5.13
EY3.96%
EPS(NY)6.14
Fwd EY4.73%
FCF(TTM)4.9
FCFY3.78%
OCF(TTM)5.82
OCFY4.49%
SpS25.88
BVpS-27.5
TBVpS-31.62
PEG (NY)3.58
PEG (5Y)2.44
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 23.62% | ||
| ROE | N/A | ||
| ROCE | 44.47% | ||
| ROIC | 37.26% | ||
| ROICexc | 41.58% | ||
| ROICexgc | 54.97% | ||
| OM | 32.48% | ||
| PM (TTM) | 21.13% | ||
| GM | 48.57% | ||
| FCFM | 18.93% |
ROA(3y)24.9%
ROA(5y)22.98%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)40.71%
ROIC(5y)39.66%
ROICexc(3y)45.18%
ROICexc(5y)45.44%
ROICexgc(3y)60%
ROICexgc(5y)60.79%
ROCE(3y)48.59%
ROCE(5y)47.35%
ROICexcg growth 3Y1%
ROICexcg growth 5Y-7.44%
ROICexc growth 3Y2.97%
ROICexc growth 5Y-5.58%
OM growth 3Y3.97%
OM growth 5Y1.1%
PM growth 3Y12.16%
PM growth 5Y-3.6%
GM growth 3Y1.29%
GM growth 5Y1.12%
F-Score6
Asset Turnover1.12
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 8.19 | ||
| Debt/EBITDA | 4.44 | ||
| Cap/Depr | 152.07% | ||
| Cap/Sales | 3.56% | ||
| Interest Coverage | 4.56 | ||
| Cash Conversion | 64.57% | ||
| Profit Quality | 89.58% | ||
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.37 | ||
| Altman-Z | 2.33 |
F-Score6
WACC7.92%
ROIC/WACC4.7
Cap/Depr(3y)172.54%
Cap/Depr(5y)160.44%
Cap/Sales(3y)3.87%
Cap/Sales(5y)3.59%
Profit Quality(3y)87.63%
Profit Quality(5y)95.2%
High Growth Momentum
Growth
EPS 1Y (TTM)-1.72%
EPS 3Y12.61%
EPS 5Y10.35%
EPS Q2Q%-4.86%
EPS Next Y7.05%
EPS Next 2Y8.96%
EPS Next 3Y9.78%
EPS Next 5Y10.84%
Revenue 1Y (TTM)2.32%
Revenue growth 3Y7.78%
Revenue growth 5Y4.46%
Sales Q2Q%6.91%
Revenue Next Year5.49%
Revenue Next 2Y6.04%
Revenue Next 3Y6.15%
Revenue Next 5Y6.79%
EBIT growth 1Y4.17%
EBIT growth 3Y12.05%
EBIT growth 5Y5.61%
EBIT Next Year12.96%
EBIT Next 3Y8.93%
EBIT Next 5Y8.59%
FCF growth 1Y20.02%
FCF growth 3Y4.8%
FCF growth 5Y6.95%
OCF growth 1Y16.92%
OCF growth 3Y7.1%
OCF growth 5Y6.39%