Yum! Brands, Inc. (YUM) Cut to Sell at Zacks Investment Research

Zacks Investment Research lowered shares of Yum! Brands, Inc. (NYSE:YUM) from a hold rating to a sell rating in a research note published on Tuesday, October 17th.

According to Zacks, “Yum! Brands has performed relatively well in the domestic and many key international markets. Following China business spin-off, Yum! Brands’ endeavors to drive growth by employing greater focus on the development of its three iconic global brands, increasing its franchise ownership, and creating a leaner, more efficient cost structure, bode well. In fact, its shares have also outpaced the industry ever since the separation. However, Yum! Brands is exposed to various emerging nations in Latin America that have been exhibiting decelerating growth due to various macro headwinds. A soft consumer spending environment in the U.S. restaurants space is another concern. Again, continual underperformance of the Pizza Hut U.S. division, macroeconomic concerns coupled with negative currency translation raises concern.”

Other equities analysts have also issued reports about the stock. CIBC lifted their price objective on shares of Yum! Brands from $80.00 to $85.00 and gave the company an outperform rating in a research report on Friday, September 8th. Robert W. Baird reiterated a hold rating and issued a $78.00 price objective on shares of Yum! Brands in a research report on Thursday, October 12th. BidaskClub upgraded shares of Yum! Brands from a buy rating to a strong-buy rating in a research report on Saturday, June 24th. Cowen and Company reiterated a buy rating and issued a $85.00 price objective on shares of Yum! Brands in a research report on Friday, September 8th. Finally, BMO Capital Markets lifted their price objective on shares of Yum! Brands from $66.00 to $77.00 and gave the company a market perform rating in a research report on Thursday, August 3rd. Eleven research analysts have rated the stock with a hold rating, twelve have assigned a buy rating and two have given a strong buy rating to the company. The stock has an average rating of Buy and a consensus price target of $79.34.

Yum! Brands (NYSE YUM) opened at 75.87 on Tuesday. The firm has a 50 day moving average of $75.59 and a 200-day moving average of $73.12. The stock has a market cap of $26.16 billion, a PE ratio of 20.14 and a beta of 0.81. Yum! Brands has a 52-week low of $59.57 and a 52-week high of $78.14.

Yum! Brands (NYSE:YUM) last announced its earnings results on Thursday, August 3rd. The restaurant operator reported $0.68 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.61 by $0.07. The business had revenue of $1.45 billion for the quarter, compared to analyst estimates of $1.42 billion. Yum! Brands had a net margin of 16.76% and a negative return on equity of 24.95%. The company’s revenue for the quarter was down 4.0% compared to the same quarter last year. During the same period last year, the firm posted $0.75 earnings per share. Equities analysts anticipate that Yum! Brands will post $2.81 earnings per share for the current fiscal year.

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The business also recently disclosed a quarterly dividend, which will be paid on Friday, December 8th. Investors of record on Wednesday, November 15th will be paid a dividend of $0.30 per share. The ex-dividend date is Tuesday, November 14th. This represents a $1.20 dividend on an annualized basis and a yield of 1.58%. Yum! Brands’s payout ratio is currently 33.15%.

In related news, CFO David W. Gibbs sold 8,336 shares of the company’s stock in a transaction on Wednesday, August 9th. The stock was sold at an average price of $74.00, for a total transaction of $616,864.00. Following the completion of the transaction, the chief financial officer now directly owns 39,664 shares in the company, valued at approximately $2,935,136. The sale was disclosed in a document filed with the SEC, which is available through this link. 7.38% of the stock is owned by corporate insiders.

Several institutional investors have recently made changes to their positions in the company. Vanguard Group Inc. lifted its holdings in shares of Yum! Brands by 3.3% in the second quarter. Vanguard Group Inc. now owns 22,604,873 shares of the restaurant operator’s stock valued at $1,667,335,000 after buying an additional 711,910 shares during the period. BlackRock Inc. lifted its holdings in shares of Yum! Brands by 2,392.9% in the first quarter. BlackRock Inc. now owns 20,053,997 shares of the restaurant operator’s stock valued at $1,281,452,000 after buying an additional 19,249,564 shares during the period. Magellan Asset Management Ltd lifted its holdings in shares of Yum! Brands by 2.0% during the second quarter. Magellan Asset Management Ltd now owns 15,446,852 shares of the restaurant operator’s stock valued at $1,139,360,000 after purchasing an additional 308,387 shares during the last quarter. Loomis Sayles & Co. L P lifted its holdings in shares of Yum! Brands by 0.3% during the first quarter. Loomis Sayles & Co. L P now owns 6,379,688 shares of the restaurant operator’s stock valued at $407,662,000 after purchasing an additional 17,799 shares during the last quarter. Finally, Morgan Stanley lifted its holdings in shares of Yum! Brands by 82.4% during the first quarter. Morgan Stanley now owns 4,757,237 shares of the restaurant operator’s stock valued at $303,987,000 after purchasing an additional 2,148,751 shares during the last quarter. Institutional investors and hedge funds own 71.99% of the company’s stock.

Yum! Brands Company Profile

YUM! Brands, Inc is engaged in restaurant business. As of December 31, 2016, the Company operated or franchised over 43,500 restaurants in more than 135 countries and territories operating under the KFC, Pizza Hut or Taco Bell (collectively the Concepts) brands. The Company operates through three segments: The KFC Division, which includes the operations of the KFC concept around the world; The Pizza Hut Division, which includes the operations of the Pizza Hut concept around the world, and The Taco Bell Division, which includes the operations of the Taco Bell concept around the world.

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Analyst Recommendations for Yum! Brands (NYSE:YUM)

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