Yum! Brands (YUM) Lifted to Buy at ValuEngine

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ValuEngine upgraded shares of Yum! Brands (NYSE:YUM) from a hold rating to a buy rating in a research note issued to investors on Friday.

A number of other equities research analysts have also recently commented on YUM. UBS Group set a $91.00 target price on shares of Yum! Brands and gave the company a buy rating in a research report on Wednesday, May 30th. Citigroup increased their target price on shares of Yum! Brands from $80.00 to $87.00 and gave the company a neutral rating in a research report on Tuesday, June 19th. BTIG Research raised shares of Yum! Brands from a neutral rating to a buy rating in a research report on Wednesday, June 27th. They noted that the move was a valuation call. Finally, BMO Capital Markets reissued a hold rating and set a $88.00 target price on shares of Yum! Brands in a research report on Friday, August 3rd. Eleven equities research analysts have rated the stock with a hold rating and twelve have assigned a buy rating to the company. The stock has an average rating of Buy and a consensus target price of $86.22.

NYSE:YUM traded up $0.48 during midday trading on Friday, reaching $88.40. 1,394,369 shares of the stock traded hands, compared to its average volume of 1,568,451. Yum! Brands has a 12-month low of $72.61 and a 12-month high of $88.66. The company has a quick ratio of 1.30, a current ratio of 1.30 and a debt-to-equity ratio of -1.33. The stock has a market capitalization of $27.90 billion, a price-to-earnings ratio of 29.86, a PEG ratio of 1.98 and a beta of 0.86.

Yum! Brands (NYSE:YUM) last posted its earnings results on Thursday, August 2nd. The restaurant operator reported $0.82 EPS for the quarter, beating the Zacks’ consensus estimate of $0.74 by $0.08. Yum! Brands had a net margin of 27.95% and a negative return on equity of 17.36%. The company had revenue of $1.37 billion during the quarter, compared to analysts’ expectations of $1.36 billion. During the same quarter in the prior year, the company posted $0.68 earnings per share. Yum! Brands’s revenue for the quarter was down 5.5% compared to the same quarter last year. analysts expect that Yum! Brands will post 3.48 EPS for the current year.

The business also recently declared a quarterly dividend, which was paid on Friday, September 7th. Shareholders of record on Monday, August 20th were paid a dividend of $0.36 per share. The ex-dividend date was Friday, August 17th. This represents a $1.44 dividend on an annualized basis and a yield of 1.63%. Yum! Brands’s payout ratio is 48.65%.

Yum! Brands announced that its board has authorized a share buyback program on Friday, August 10th that allows the company to repurchase $2.00 billion in outstanding shares. This repurchase authorization allows the restaurant operator to reacquire up to 7.6% of its stock through open market purchases. Stock repurchase programs are typically a sign that the company’s board of directors believes its shares are undervalued.

Large investors have recently added to or reduced their stakes in the company. Schwab Charles Investment Management Inc. increased its stake in shares of Yum! Brands by 1.1% in the second quarter. Schwab Charles Investment Management Inc. now owns 1,227,054 shares of the restaurant operator’s stock worth $95,981,000 after acquiring an additional 13,855 shares during the period. Livforsakringsbolaget Skandia Omsesidigt increased its stake in shares of Yum! Brands by 22.2% in the second quarter. Livforsakringsbolaget Skandia Omsesidigt now owns 6,047 shares of the restaurant operator’s stock worth $473,000 after acquiring an additional 1,100 shares during the period. Gideon Capital Advisors Inc. acquired a new stake in shares of Yum! Brands in the second quarter worth $431,000. Whittier Trust Co. increased its stake in shares of Yum! Brands by 464.0% in the second quarter. Whittier Trust Co. now owns 51,906 shares of the restaurant operator’s stock worth $4,215,000 after acquiring an additional 42,703 shares during the period. Finally, HL Financial Services LLC increased its stake in shares of Yum! Brands by 78.5% in the second quarter. HL Financial Services LLC now owns 37,204 shares of the restaurant operator’s stock worth $2,910,000 after acquiring an additional 16,361 shares during the period. Hedge funds and other institutional investors own 71.74% of the company’s stock.

Yum! Brands Company Profile

YUM! Brands, Inc, together with its subsidiaries, develops, operates, and franchises quick service restaurants worldwide. It operates in three segments: the KFC Division, the Pizza Hut Division, and the Taco Bell Division. The company operates restaurants under the KFC, Pizza Hut, and Taco Bell brands, which specialize in chicken, pizza, and Mexican-style food categories.

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Analyst Recommendations for Yum! Brands (NYSE:YUM)

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