YUM CHINA HOLDINGS INC (YUMC) Stock Fundamental Analysis
NYSE:YUMC - New York Stock Exchange, Inc. - US98850P1093 - Common Stock - Currency: USD
Overall YUMC gets a fundamental rating of 6 out of 10. We evaluated YUMC against 134 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 decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year YUMC was profitable.
In the past year YUMC had a positive cash flow from operations.
In the past 5 years YUMC has always been profitable.
YUMC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
YUMC has a better Return On Assets (8.19%) than 80.15% of its industry peers.
The Return On Equity of YUMC (15.90%) is better than 74.81% of its industry peers.
With a decent Return On Invested Capital value of 9.81%, YUMC is doing good in the industry, outperforming 70.23% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for YUMC is below the industry average of 10.64%.
The last Return On Invested Capital (9.81%) for YUMC is above the 3 year average (8.01%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.19% | ||
| ROE | 15.9% | ||
| ROIC | 9.81% |
ROA(3y)6.27%
ROA(5y)6.7%
ROE(3y)11.88%
ROE(5y)12.46%
ROIC(3y)8.01%
ROIC(5y)7.07%
1.3 Margins
YUMC has a Profit Margin of 8.06%. This is in the better half of the industry: YUMC outperforms 67.94% of its industry peers.
In the last couple of years the Profit Margin of YUMC has remained more or less at the same level.
YUMC has a Operating Margin (10.63%) which is in line with its industry peers.
YUMC's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 41.80%, YUMC is doing worse than 61.83% of the companies in the same industry.
YUMC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.63% | ||
| PM (TTM) | 8.06% | ||
| GM | 41.8% |
OM growth 3Y10.45%
OM growth 5Y1.23%
PM growth 3Y-7.08%
PM growth 5Y-0.16%
GM growth 3Y-0.12%
GM growth 5Y-0.93%
2. Health
2.1 Basic Checks
YUMC has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for YUMC has been reduced compared to 1 year ago.
Compared to 5 years ago, YUMC has more shares outstanding
Compared to 1 year ago, YUMC has an improved debt to assets ratio.
2.2 Solvency
YUMC has an Altman-Z score of 3.73. This indicates that YUMC is financially healthy and has little risk of bankruptcy at the moment.
YUMC has a Altman-Z score of 3.73. This is amongst the best in the industry. YUMC outperforms 80.15% of its industry peers.
The Debt to FCF ratio of YUMC is 0.25, which is an excellent value as it means it would take YUMC, only 0.25 years of fcf income to pay off all of its debts.
YUMC has a better Debt to FCF ratio (0.25) than 93.89% of its industry peers.
A Debt/Equity ratio of 0.03 indicates that YUMC is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.03, YUMC belongs to the top of the industry, outperforming 87.02% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.03 | ||
| Debt/FCF | 0.25 | ||
| Altman-Z | 3.73 |
ROIC/WACC1.25
WACC7.87%
2.3 Liquidity
A Current Ratio of 1.18 indicates that YUMC should not have too much problems paying its short term obligations.
YUMC has a better Current ratio (1.18) than 62.60% of its industry peers.
YUMC has a Quick Ratio of 1.00. 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 (1.00) is better than 61.07% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.18 | ||
| Quick Ratio | 1 |
3. Growth
3.1 Past
YUMC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 16.50%, which is quite good.
The Earnings Per Share has been growing slightly by 4.39% on average over the past years.
The Revenue has been growing slightly by 2.96% in the past year.
Measured over the past years, YUMC shows a small growth in Revenue. The Revenue has been growing by 5.19% on average per year.
EPS 1Y (TTM)16.5%
EPS 3Y24.41%
EPS 5Y4.39%
EPS Q2Q%20%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y4.68%
Revenue growth 5Y5.19%
Sales Q2Q%4.09%
3.2 Future
YUMC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 18.33% yearly.
The Revenue is expected to grow by 10.29% on average over the next years. This is quite good.
EPS Next Y12.52%
EPS Next 2Y13.59%
EPS Next 3Y14.54%
EPS Next 5Y18.33%
Revenue Next Year7.6%
Revenue Next 2Y7.79%
Revenue Next 3Y10.86%
Revenue Next 5Y10.29%
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 20.63 indicates a rather expensive valuation of YUMC.
YUMC's Price/Earnings ratio is a bit cheaper when compared to the industry. YUMC is cheaper than 69.47% of the companies in the same industry.
YUMC's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.20.
A Price/Forward Earnings ratio of 18.34 indicates a rather expensive valuation of YUMC.
Compared to the rest of the industry, the Price/Forward Earnings ratio of YUMC indicates a somewhat cheap valuation: YUMC is cheaper than 67.18% of the companies listed in the same industry.
YUMC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 94.48.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.63 | ||
| Fwd PE | 18.34 |
4.2 Price Multiples
74.81% of the companies in the same industry are more expensive than YUMC, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of YUMC indicates a somewhat cheap valuation: YUMC is cheaper than 70.23% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 25.57 | ||
| EV/EBITDA | 9.23 |
4.3 Compensation for Growth
YUMC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
YUMC has a very decent profitability rating, which may justify a higher PE ratio.
YUMC's earnings are expected to grow with 14.54% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.65
PEG (5Y)4.7
EPS Next 2Y13.59%
EPS Next 3Y14.54%
5. Dividend
5.1 Amount
YUMC has a Yearly Dividend Yield of 1.98%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.12, YUMC pays a bit more dividend than its industry peers.
YUMC's Dividend Yield is comparable with the S&P500 average which is at 2.30.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.98% |
5.2 History
The dividend of YUMC has a limited annual growth rate of 5.67%.
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)5.67%
Div Incr Years2
Div Non Decr Years4
5.3 Sustainability
YUMC pays out 27.22% 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.
DP27.22%
EPS Next 2Y13.59%
EPS Next 3Y14.54%
YUM CHINA HOLDINGS INC
NYSE:YUMC (2/10/2025, 8:04:00 PM)
After market: 48.5 +0.43 (+0.89%)48.07
-0.37 (-0.76%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners83.07%
Inst Owner Change-26.5%
Ins Owners0.32%
Ins Owner Change5.09%
Market Cap18.26B
Analysts83.13
Price Target58 (20.66%)
Short Float %3.03%
Short Ratio5.25
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.98% |
Yearly Dividend0.63
Dividend Growth(5Y)5.67%
DP27.22%
Div Incr Years2
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.8%
Min EPS beat(2)1.77%
Max EPS beat(2)11.84%
EPS beat(4)4
Avg EPS beat(4)8.75%
Min EPS beat(4)1.77%
Max EPS beat(4)14.29%
EPS beat(8)7
Avg EPS beat(8)15.03%
EPS beat(12)9
Avg EPS beat(12)390.36%
EPS beat(16)10
Avg EPS beat(16)286.14%
Revenue beat(2)0
Avg Revenue beat(2)-2.35%
Min Revenue beat(2)-3.32%
Max Revenue beat(2)-1.38%
Revenue beat(4)0
Avg Revenue beat(4)-3.71%
Min Revenue beat(4)-5.27%
Max Revenue beat(4)-1.38%
Revenue beat(8)2
Avg Revenue beat(8)-2.45%
Revenue beat(12)2
Avg Revenue beat(12)-2.84%
Revenue beat(16)3
Avg Revenue beat(16)-2.15%
PT rev (1m)1.28%
PT rev (3m)13.82%
EPS NQ rev (1m)-6.77%
EPS NQ rev (3m)-6.77%
EPS NY rev (1m)-0.52%
EPS NY rev (3m)-0.24%
Revenue NQ rev (1m)-0.52%
Revenue NQ rev (3m)-0.52%
Revenue NY rev (1m)-0.23%
Revenue NY rev (3m)-0.31%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.63 | ||
| Fwd PE | 18.34 | ||
| P/S | 1.62 | ||
| P/FCF | 25.57 | ||
| P/OCF | 12.86 | ||
| P/B | 3.19 | ||
| P/tB | 4.93 | ||
| EV/EBITDA | 9.23 |
EPS(TTM)2.33
EY4.85%
EPS(NY)2.62
Fwd EY5.45%
FCF(TTM)1.88
FCFY3.91%
OCF(TTM)3.74
OCFY7.77%
SpS29.76
BVpS15.08
TBVpS9.75
PEG (NY)1.65
PEG (5Y)4.7
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.19% | ||
| ROE | 15.9% | ||
| ROCE | 13.59% | ||
| ROIC | 9.81% | ||
| ROICexc | 12.35% | ||
| ROICexgc | 17.25% | ||
| OM | 10.63% | ||
| PM (TTM) | 8.06% | ||
| GM | 41.8% | ||
| FCFM | 6.32% |
ROA(3y)6.27%
ROA(5y)6.7%
ROE(3y)11.88%
ROE(5y)12.46%
ROIC(3y)8.01%
ROIC(5y)7.07%
ROICexc(3y)10.81%
ROICexc(5y)10.5%
ROICexgc(3y)15.53%
ROICexgc(5y)15.57%
ROCE(3y)11.07%
ROCE(5y)9.74%
ROICexcg growth 3Y8.41%
ROICexcg growth 5Y-4.9%
ROICexc growth 3Y14.1%
ROICexc growth 5Y-7.31%
OM growth 3Y10.45%
OM growth 5Y1.23%
PM growth 3Y-7.08%
PM growth 5Y-0.16%
GM growth 3Y-0.12%
GM growth 5Y-0.93%
F-Score6
Asset Turnover1.02
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.03 | ||
| Debt/FCF | 0.25 | ||
| Debt/EBITDA | 0.1 | ||
| Cap/Depr | 148.11% | ||
| Cap/Sales | 6.24% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 84.62% | ||
| Profit Quality | 78.38% | ||
| Current Ratio | 1.18 | ||
| Quick Ratio | 1 | ||
| Altman-Z | 3.73 |
F-Score6
WACC7.87%
ROIC/WACC1.25
Cap/Depr(3y)139.21%
Cap/Depr(5y)128.85%
Cap/Sales(3y)6.6%
Cap/Sales(5y)6.37%
Profit Quality(3y)112.23%
Profit Quality(5y)94%
High Growth Momentum
Growth
EPS 1Y (TTM)16.5%
EPS 3Y24.41%
EPS 5Y4.39%
EPS Q2Q%20%
EPS Next Y12.52%
EPS Next 2Y13.59%
EPS Next 3Y14.54%
EPS Next 5Y18.33%
Revenue 1Y (TTM)2.96%
Revenue growth 3Y4.68%
Revenue growth 5Y5.19%
Sales Q2Q%4.09%
Revenue Next Year7.6%
Revenue Next 2Y7.79%
Revenue Next 3Y10.86%
Revenue Next 5Y10.29%
EBIT growth 1Y5.81%
EBIT growth 3Y15.62%
EBIT growth 5Y6.49%
EBIT Next Year58.37%
EBIT Next 3Y26.08%
EBIT Next 5Y21.32%
FCF growth 1Y-6.42%
FCF growth 3Y17.33%
FCF growth 5Y-0.98%
OCF growth 1Y-3.67%
OCF growth 3Y7.85%
OCF growth 5Y3.67%