YUM! BRANDS INC (YUM)
US9884981013 - Common Stock
We assign a fundamental rating of 5 out of 10 to YUM. YUM was compared to 135 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 valied quite expensively at the moment, while 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.
In the past 5 years YUM has always been profitable.
YUM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
YUM has a Return On Assets of 25.88%. This is amongst the best in the industry. YUM outperforms 98.51% of its industry peers.
The Return On Invested Capital of YUM (38.23%) is better than 97.76% of its industry peers.
The Average Return On Invested Capital over the past 3 years for YUM is significantly above the industry average of 9.90%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 25.88% | ||
| ROE | N/A | ||
| ROIC | 38.23% |
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 (22.92%) is better than 95.52% of its industry peers.
In the last couple of years the Profit Margin of YUM has declined.
YUM has a Operating Margin of 32.69%. This is amongst the best in the industry. YUM outperforms 96.27% of its industry peers.
In the last couple of years the Operating Margin of YUM has remained more or less at the same level.
YUM has a Gross Margin (49.58%) which is in line with its industry peers.
YUM's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 32.69% | ||
| PM (TTM) | 22.92% | ||
| GM | 49.58% |
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%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), YUM is creating value.
The number of shares outstanding for YUM has been increased compared to 1 year ago.
Compared to 5 years ago, YUM has less shares outstanding
The debt/assets ratio for YUM has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.49 indicates that YUM is not a great score, but indicates only limited risk for bankruptcy at the moment.
YUM has a better Altman-Z score (2.49) than 73.88% of its industry peers.
The Debt to FCF ratio of YUM is 8.32, which is on the high side as it means it would take YUM, 8.32 years of fcf income to pay off all of its debts.
YUM's Debt to FCF ratio of 8.32 is fine compared to the rest of the industry. YUM outperforms 64.18% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 8.32 | ||
| Altman-Z | 2.49 |
ROIC/WACC4.62
WACC8.27%
2.3 Liquidity
YUM has a Current Ratio of 1.49. This is a normal value and indicates that YUM is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of YUM (1.49) is better than 72.39% of its industry peers.
YUM has a Quick Ratio of 1.49. This is a normal value and indicates that YUM is financially healthy and should not expect problems in meeting its short term obligations.
YUM has a Quick ratio of 1.49. This is in the better half of the industry: YUM outperforms 74.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.49 | ||
| Quick Ratio | 1.49 |
3. Growth
3.1 Past
YUM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 16.63%, which is quite good.
The Earnings Per Share has been growing by 10.35% on average over the past years. This is quite good.
The Revenue has been growing slightly by 1.28% in the past 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)16.63%
EPS 3Y12.61%
EPS 5Y10.35%
EPS growth Q2Q8.49%
Revenue 1Y (TTM)1.28%
Revenue growth 3Y7.78%
Revenue growth 5Y4.46%
Revenue growth Q2Q-2.86%
3.2 Future
YUM is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 12.71% yearly.
YUM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.93% yearly.
EPS Next Y13.1%
EPS Next 2Y12.76%
EPS Next 3Y12.89%
EPS Next 5Y12.71%
Revenue Next Year8.9%
Revenue Next 2Y7.79%
Revenue Next 3Y7.93%
Revenue Next 5Y6.93%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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
A Price/Earnings ratio of 26.93 indicates a quite expensive valuation of YUM.
YUM's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of YUM to the average of the S&P500 Index (28.60), we can say YUM is valued inline with the index average.
YUM is valuated rather expensively with a Price/Forward Earnings ratio of 21.55.
YUM's Price/Forward Earnings is on the same level as the industry average.
YUM's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 20.15.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.93 | ||
| Fwd PE | 21.55 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of YUM indicates a slightly more expensive valuation: YUM is more expensive than 71.64% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of YUM is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 29.63 | ||
| EV/EBITDA | 20.51 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates YUM does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of YUM may justify a higher PE ratio.
A more expensive valuation may be justified as YUM's earnings are expected to grow with 12.89% in the coming years.
PEG (NY)2.06
PEG (5Y)2.6
EPS Next 2Y12.76%
EPS Next 3Y12.89%
5. Dividend
5.1 Amount
YUM has a Yearly Dividend Yield of 1.89%. Purely for dividend investing, there may be better candidates out there.
YUM's Dividend Yield is rather good when compared to the industry average which is at 2.75. YUM pays more dividend than 80.60% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.32, YUM has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.89% |
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.
YUM has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)10.79%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
YUM pays out 43.33% 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.
DP43.33%
EPS Next 2Y12.76%
EPS Next 3Y12.89%
YUM! BRANDS INC
NYSE:YUM (5/17/2024, 7:04:00 PM)
After market: 141.01 -0.65 (-0.46%)141.66
0 (0%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap39.85B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.89% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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Revenue beat(8)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.93 | ||
| Fwd PE | 21.55 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)2.06
PEG (5Y)2.6
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 25.88% | ||
| ROE | N/A | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 32.69% | ||
| PM (TTM) | 22.92% | ||
| GM | 49.58% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.13
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.49 | ||
| Quick Ratio | 1.49 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)16.63%
EPS 3Y12.61%
EPS 5Y
EPS growth Q2Q
EPS Next Y13.1%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)1.28%
Revenue growth 3Y7.78%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y