YUM CHINA HOLDINGS INC (YUMC)
US98850P1093 - Common Stock
Overall YUMC gets a fundamental rating of 6 out of 10. We evaluated YUMC against 133 industry peers in the Hotels, Restaurants & Leisure industry. YUMC is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. YUMC has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
YUMC had positive earnings in the past year.
In the past year YUMC had a positive cash flow from operations.
YUMC had positive earnings in each of the past 5 years.
Each year in the past 5 years YUMC had a positive operating cash flow.
1.2 Ratios
YUMC has a Return On Assets of 7.57%. This is amongst the best in the industry. YUMC outperforms 80.77% of its industry peers.
Looking at the Return On Equity, with a value of 14.84%, YUMC is in the better half of the industry, outperforming 74.62% of the companies in the same industry.
YUMC's Return On Invested Capital of 8.65% is fine compared to the rest of the industry. YUMC outperforms 69.23% of its industry peers.
YUMC had an Average Return On Invested Capital over the past 3 years of 6.34%. This is below the industry average of 10.64%.
The last Return On Invested Capital (8.65%) for YUMC is above the 3 year average (6.34%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.57% | ||
| ROE | 14.84% | ||
| ROIC | 8.65% |
ROA(3y)6.03%
ROA(5y)7.11%
ROE(3y)11.25%
ROE(5y)13.91%
ROIC(3y)6.34%
ROIC(5y)7.4%
1.3 Margins
The Profit Margin of YUMC (7.97%) is better than 67.69% of its industry peers.
In the last couple of years the Profit Margin of YUMC has declined.
YUMC has a Operating Margin (10.30%) which is comparable to the rest of the industry.
In the last couple of years the Operating Margin of YUMC has remained more or less at the same level.
YUMC has a Gross Margin of 41.60%. This is in the lower half of the industry: YUMC underperforms 61.54% of its industry peers.
YUMC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.3% | ||
| PM (TTM) | 7.97% | ||
| GM | 41.6% |
OM growth 3Y5.33%
OM growth 5Y0.95%
PM growth 3Y-7.4%
PM growth 5Y-2.19%
GM growth 3Y-0.38%
GM growth 5Y-1.07%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), YUMC is creating some value.
YUMC has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, YUMC has more shares outstanding
The debt/assets ratio for YUMC is higher compared to a year ago.
2.2 Solvency
YUMC has an Altman-Z score of 3.32. This indicates that YUMC is financially healthy and has little risk of bankruptcy at the moment.
YUMC has a Altman-Z score of 3.32. This is in the better half of the industry: YUMC outperforms 77.69% of its industry peers.
The Debt to FCF ratio of YUMC is 0.56, which is an excellent value as it means it would take YUMC, only 0.56 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 0.56, YUMC belongs to the best of the industry, outperforming 90.77% of the companies in the same industry.
A Debt/Equity ratio of 0.06 indicates that YUMC is not too dependend on debt financing.
YUMC has a better Debt to Equity ratio (0.06) than 83.85% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.56 | ||
| Altman-Z | 3.32 |
ROIC/WACC1.16
WACC7.49%
2.3 Liquidity
YUMC has a Current Ratio of 1.29. This is a normal value and indicates that YUMC is financially healthy and should not expect problems in meeting its short term obligations.
YUMC's Current ratio of 1.29 is fine compared to the rest of the industry. YUMC outperforms 64.62% of its industry peers.
YUMC has a Quick Ratio of 1.15. This is a normal value and indicates that YUMC is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of YUMC (1.15) is better than 63.85% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.15 |
3. Growth
3.1 Past
YUMC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 21.93%, which is quite impressive.
Measured over the past 5 years, YUMC shows a small growth in Earnings Per Share. The EPS has been growing by 5.09% on average per year.
The Revenue has been growing slightly by 5.94% in the past year.
The Revenue has been growing slightly by 5.46% on average over the past years.
EPS 1Y (TTM)21.93%
EPS 3Y9.1%
EPS 5Y5.09%
EPS Q2Q%30.51%
Revenue 1Y (TTM)5.94%
Revenue growth 3Y9.93%
Revenue growth 5Y5.46%
Sales Q2Q%5.39%
3.2 Future
Based on estimates for the next years, YUMC will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.54% on average per year.
Based on estimates for the next years, YUMC will show a quite strong growth in Revenue. The Revenue will grow by 9.17% on average per year.
EPS Next Y19.08%
EPS Next 2Y14.91%
EPS Next 3Y14.99%
EPS Next 5Y14.54%
Revenue Next Year4.98%
Revenue Next 2Y6.52%
Revenue Next 3Y7.08%
Revenue Next 5Y9.17%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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
With a Price/Earnings ratio of 19.11, YUMC is valued on the expensive side.
Based on the Price/Earnings ratio, YUMC is valued a bit cheaper than 72.31% of the companies in the same industry.
When comparing the Price/Earnings ratio of YUMC to the average of the S&P500 Index (27.34), we can say YUMC is valued slightly cheaper.
A Price/Forward Earnings ratio of 16.50 indicates a correct valuation of YUMC.
YUMC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. YUMC is cheaper than 72.31% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.61, YUMC is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.11 | ||
| Fwd PE | 16.5 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, YUMC is valued a bit cheaper than the industry average as 79.23% of the companies are valued more expensively.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of YUMC indicates a somewhat cheap valuation: YUMC is cheaper than 69.23% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.19 | ||
| EV/EBITDA | 7.85 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of YUMC may justify a higher PE ratio.
YUMC's earnings are expected to grow with 14.99% in the coming years. This may justify a more expensive valuation.
PEG (NY)1
PEG (5Y)3.75
EPS Next 2Y14.91%
EPS Next 3Y14.99%
5. Dividend
5.1 Amount
YUMC has a Yearly Dividend Yield of 1.37%.
Compared to an average industry Dividend Yield of 2.93, YUMC pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.33, YUMC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.37% |
5.2 History
The dividend of YUMC has a limited annual growth rate of 4.41%.
YUMC has been paying a dividend for over 5 years, so it has already some track record.
YUMC has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)4.41%
Div Incr Years2
Div Non Decr Years4
5.3 Sustainability
YUMC pays out 26.99% of its income as dividend. This is a sustainable payout ratio.
YUMC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP26.99%
EPS Next 2Y14.91%
EPS Next 3Y14.99%
YUM CHINA HOLDINGS INC
NYSE:YUMC (1/8/2025, 8:04:00 PM)
After market: 43.4001 -0.18 (-0.41%)43.58
-1.23 (-2.74%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners83.07%
Inst Owner Change0%
Ins Owners0.32%
Ins Owner Change1.95%
Market Cap16.55B
Analysts83.64
Price Target57.27 (31.41%)
Short Float %2.89%
Short Ratio4.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.37% |
Dividend Growth(5Y)4.41%
DP26.99%
Div Incr Years2
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.06%
Min EPS beat(2)11.84%
Max EPS beat(2)14.29%
EPS beat(4)4
Avg EPS beat(4)20.94%
Min EPS beat(4)7.09%
Max EPS beat(4)50.55%
EPS beat(8)6
Avg EPS beat(8)11.82%
EPS beat(12)8
Avg EPS beat(12)383.08%
EPS beat(16)10
Avg EPS beat(16)288.01%
Revenue beat(2)0
Avg Revenue beat(2)-3.32%
Min Revenue beat(2)-5.27%
Max Revenue beat(2)-1.38%
Revenue beat(4)1
Avg Revenue beat(4)-2.47%
Min Revenue beat(4)-5.27%
Max Revenue beat(4)1.63%
Revenue beat(8)2
Avg Revenue beat(8)-3.01%
Revenue beat(12)2
Avg Revenue beat(12)-3.05%
Revenue beat(16)4
Avg Revenue beat(16)-1.87%
PT rev (1m)0.37%
PT rev (3m)23.3%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-7.63%
EPS NY rev (1m)0.3%
EPS NY rev (3m)6.14%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-5.43%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.02%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.11 | ||
| Fwd PE | 16.5 | ||
| P/S | 1.48 | ||
| P/FCF | 25.19 | ||
| P/OCF | 11.9 | ||
| P/B | 2.75 | ||
| P/tB | 4.23 | ||
| EV/EBITDA | 7.85 |
EPS(TTM)2.28
EY5.23%
EPS(NY)2.64
Fwd EY6.06%
FCF(TTM)1.73
FCFY3.97%
OCF(TTM)3.66
OCFY8.4%
SpS29.49
BVpS15.84
TBVpS10.3
PEG (NY)1
PEG (5Y)3.75
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.57% | ||
| ROE | 14.84% | ||
| ROCE | 12.51% | ||
| ROIC | 8.65% | ||
| ROICexc | 11.78% | ||
| ROICexgc | 16.84% | ||
| OM | 10.3% | ||
| PM (TTM) | 7.97% | ||
| GM | 41.6% | ||
| FCFM | 5.87% |
ROA(3y)6.03%
ROA(5y)7.11%
ROE(3y)11.25%
ROE(5y)13.91%
ROIC(3y)6.34%
ROIC(5y)7.4%
ROICexc(3y)9.24%
ROICexc(5y)11.37%
ROICexgc(3y)13.97%
ROICexgc(5y)16.17%
ROCE(3y)8.93%
ROCE(5y)10.38%
ROICexcg growth 3Y-2.7%
ROICexcg growth 5Y-18.52%
ROICexc growth 3Y-0.56%
ROICexc growth 5Y-17.81%
OM growth 3Y5.33%
OM growth 5Y0.95%
PM growth 3Y-7.4%
PM growth 5Y-2.19%
GM growth 3Y-0.38%
GM growth 5Y-1.07%
F-Score6
Asset Turnover0.95
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.06 | ||
| Debt/FCF | 0.56 | ||
| Debt/EBITDA | 0.23 | ||
| Cap/Depr | 156.5% | ||
| Cap/Sales | 6.55% | ||
| Interest Coverage | 288.5 | ||
| Cash Conversion | 85.71% | ||
| Profit Quality | 73.57% | ||
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.15 | ||
| Altman-Z | 3.32 |
F-Score6
WACC7.49%
ROIC/WACC1.16
Cap/Depr(3y)134.35%
Cap/Depr(5y)119.56%
Cap/Sales(3y)6.85%
Cap/Sales(5y)6.12%
Profit Quality(3y)100.99%
Profit Quality(5y)99.36%
High Growth Momentum
Growth
EPS 1Y (TTM)21.93%
EPS 3Y9.1%
EPS 5Y5.09%
EPS Q2Q%30.51%
EPS Next Y19.08%
EPS Next 2Y14.91%
EPS Next 3Y14.99%
EPS Next 5Y14.54%
Revenue 1Y (TTM)5.94%
Revenue growth 3Y9.93%
Revenue growth 5Y5.46%
Sales Q2Q%5.39%
Revenue Next Year4.98%
Revenue Next 2Y6.52%
Revenue Next 3Y7.08%
Revenue Next 5Y9.17%
EBIT growth 1Y6.07%
EBIT growth 3Y15.8%
EBIT growth 5Y6.46%
EBIT Next Year48.06%
EBIT Next 3Y22.23%
EBIT Next 5Y18.06%
FCF growth 1Y-1.94%
FCF growth 3Y3.16%
FCF growth 5Y-2.43%
OCF growth 1Y0.36%
OCF growth 3Y9.76%
OCF growth 5Y2.02%