1ST Source Bank Acquires New Shares in Yum! Brands, Inc. $YUM

Key Points

• 1ST Source Bank acquired 15,601 Yum! Brands shares worth approximately $2.5 million in the second quarter. Institutional investors and hedge funds collectively own 82.37% of the company.
• Analysts maintain a generally favorable view, with 11 Buy ratings and seven Holds producing a “Moderate Buy” consensus and an average price target of $174.31.
• Yum! Brands exceeded quarterly EPS expectations, reporting $1.62 versus $1.58 estimates, while revenue rose 12.2% year over year. The company also authorized a $4 billion share-repurchase program covering up to 9.4% of outstanding shares.

1ST Source Bank bought a new stake in shares of Yum! Brands, Inc. (NYSE:YUM - Free Report) during the 2nd quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The firm bought 15,601 shares of the restaurant operator's stock, valued at approximately $2,494,000.

A number of other institutional investors and hedge funds also recently made changes to their positions in the stock. Capital International Investors lifted its holdings in shares of Yum! Brands by 20.0% during the fourth quarter. Capital International Investors now owns 19,419,826 shares of the restaurant operator's stock worth $2,938,139,000 after buying an additional 3,240,190 shares during the last quarter. State Street Corp grew its stake in shares of Yum! Brands by 1.0% in the fourth quarter. State Street Corp now owns 13,164,814 shares of the restaurant operator's stock worth $1,991,573,000 after acquiring an additional 124,720 shares during the last quarter. Geode Capital Management LLC increased its position in Yum! Brands by 1.4% during the fourth quarter. Geode Capital Management LLC now owns 8,800,382 shares of the restaurant operator's stock worth $1,334,427,000 after acquiring an additional 121,304 shares during the period. Norges Bank acquired a new position in Yum! Brands during the 4th quarter valued at $706,799,000. Finally, Morgan Stanley raised its stake in Yum! Brands by 2.4% during the 4th quarter. Morgan Stanley now owns 4,471,127 shares of the restaurant operator's stock valued at $676,392,000 after purchasing an additional 104,512 shares during the last quarter. Institutional investors and hedge funds own 82.37% of the company's stock.

Insiders Place Their Bets

In related news, CEO Aaron Powell sold 6,001 shares of Yum! Brands stock in a transaction that occurred on Wednesday, July 1st. The shares were sold at an average price of $160.42, for a total transaction of $962,680.42. Following the transaction, the chief executive officer owned 12,003 shares of the company's stock, valued at $1,925,521.26. This trade represents a 33.33% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Scott Mezvinsky sold 268 shares of Yum! Brands stock in a transaction dated Monday, August 3rd. The stock was sold at an average price of $153.15, for a total value of $41,044.20. Following the transaction, the chief executive officer owned 483 shares in the company, valued at approximately $73,971.45. This represents a 35.69% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 18,549 shares of company stock worth $2,890,168 over the last ninety days. Company insiders own 0.14% of the company's stock.

Analyst Ratings Changes

Several research firms have issued reports on YUM. Wells Fargo & Company raised their price target on shares of Yum! Brands from $160.00 to $165.00 and gave the stock an "equal weight" rating in a research report on Thursday, April 30th. Deutsche Bank Aktiengesellschaft restated a "hold" rating and issued a $174.00 target price on shares of Yum! Brands in a research note on Friday, July 31st. Royal Bank Of Canada lifted their price target on shares of Yum! Brands from $165.00 to $170.00 and gave the stock a "sector perform" rating in a research note on Friday, July 31st. Weiss Ratings lowered shares of Yum! Brands from a "buy (b)" rating to a "buy (b-)" rating in a report on Tuesday, July 28th. Finally, Evercore restated an "outperform" rating on shares of Yum! Brands in a research note on Tuesday, June 16th. Eleven investment analysts have rated the stock with a Buy rating and seven have assigned a Hold rating to the company. According to MarketBeat, the stock has an average rating of "Moderate Buy" and a consensus price target of $174.31.

Yum! Brands Price Performance

YUM stock opened at $148.21 on Monday. The company has a 50 day moving average price of $153.75 and a 200 day moving average price of $156.22. The stock has a market capitalization of $40.45 billion, a PE ratio of 18.64, a price-to-earnings-growth ratio of 2.40 and a beta of 0.55. Yum! Brands, Inc. has a fifty-two week low of $137.33 and a fifty-two week high of $170.14.

Yum! Brands (NYSE:YUM - Get Free Report) last released its earnings results on Thursday, July 30th. The restaurant operator reported $1.62 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.58 by $0.04. Yum! Brands had a net margin of 25.42% and a negative return on equity of 24.57%. The company had revenue of $2.17 billion for the quarter, compared to the consensus estimate of $2.18 billion. During the same period in the prior year, the company posted $1.44 EPS. The company's revenue was up 12.2% compared to the same quarter last year. As a group, equities analysts expect that Yum! Brands, Inc. will post 6.42 earnings per share for the current fiscal year.

Yum! Brands announced that its board has initiated a stock repurchase program on Tuesday, June 16th that authorizes the company to buyback $4.00 billion in outstanding shares. This buyback authorization authorizes the restaurant operator to buy up to 9.4% of its stock through open market purchases. Stock buyback programs are typically a sign that the company's board believes its stock is undervalued.

About Yum! Brands

Yum! Brands, Inc NYSE: YUM is a global quick-service restaurant company that develops, operates and franchises a portfolio of well-known restaurant brands. The company's principal brands are KFC, Pizza Hut and Taco Bell, each focused on distinct product categories—KFC on fried chicken and related menu items, Pizza Hut on pizza and complementary offerings, and Taco Bell on Mexican-inspired quick-service food. Yum! is headquartered in Louisville, Kentucky and was formed as Tricon Global Restaurants in 1997 when PepsiCo spun off its restaurant businesses, later adopting the Yum! Brands name.

The company's operating model centers on brand development, system growth and franchising; a large portion of its restaurants are operated by independent franchisees, and Yum! generates revenue through franchise royalties and fees in addition to sales from company-operated locations.

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