Norges Bank Purchases Shares of 4,672,125 Yum! Brands, Inc. $YUM

Key Points

• Norges Bank disclosed a new fourth-quarter stake in Yum! Brands, buying 4,672,125 shares worth about $706.8 million, giving it 1.68% ownership of the company.
• Yum! Brands reported better-than-expected quarterly results, with EPS of $1.50 versus $1.39 expected and revenue of $2.06 billion, up 15.2% year over year.
• The company also declared a quarterly dividend of $0.75 per share, implying a 2.0% annualized yield, while analysts currently rate the stock a Moderate Buy with an average target price of $175.89.

Norges Bank purchased a new stake in Yum! Brands, Inc. (NYSE:YUM - Free Report) in the fourth quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission. The institutional investor purchased 4,672,125 shares of the restaurant operator's stock, valued at approximately $706,799,000. Norges Bank owned 1.68% of Yum! Brands at the end of the most recent reporting period.

A number of other hedge funds have also recently bought and sold shares of the stock. Vanguard Group Inc. boosted its holdings in Yum! Brands by 2.0% in the 3rd quarter. Vanguard Group Inc. now owns 35,242,558 shares of the restaurant operator's stock valued at $5,356,869,000 after purchasing an additional 684,946 shares during the period. Capital International Investors boosted its holdings in Yum! Brands by 3.1% in the 3rd quarter. Capital International Investors now owns 16,179,636 shares of the restaurant operator's stock valued at $2,459,940,000 after purchasing an additional 487,069 shares during the period. Geode Capital Management LLC boosted its holdings in Yum! Brands by 1.4% in the 4th quarter. Geode Capital Management LLC now owns 8,800,382 shares of the restaurant operator's stock valued at $1,334,427,000 after purchasing an additional 121,304 shares during the period. Northern Trust Corp boosted its holdings in Yum! Brands by 5.6% in the 3rd quarter. Northern Trust Corp now owns 3,348,846 shares of the restaurant operator's stock valued at $509,025,000 after purchasing an additional 176,221 shares during the period. Finally, Invesco Ltd. boosted its holdings in Yum! Brands by 5.5% in the 3rd quarter. Invesco Ltd. now owns 2,943,187 shares of the restaurant operator's stock valued at $447,364,000 after purchasing an additional 153,459 shares during the period. 82.37% of the stock is owned by institutional investors.

Yum! Brands Stock Up 0.0%

Shares of YUM stock opened at $147.96 on Monday. Yum! Brands, Inc. has a 12-month low of $137.33 and a 12-month high of $169.39. The company has a market capitalization of $40.78 billion, a P/E ratio of 23.86, a P/E/G ratio of 1.88 and a beta of 0.57. The firm has a 50-day moving average price of $156.29 and a 200 day moving average price of $155.69.

Yum! Brands (NYSE:YUM - Get Free Report) last announced its quarterly earnings results on Wednesday, April 29th. The restaurant operator reported $1.50 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.39 by $0.11. Yum! Brands had a net margin of 20.48% and a negative return on equity of 23.51%. The firm had revenue of $2.06 billion during the quarter, compared to the consensus estimate of $2.04 billion. During the same period last year, the firm posted $1.30 EPS. The firm's quarterly revenue was up 15.2% on a year-over-year basis. As a group, research analysts expect that Yum! Brands, Inc. will post 6.77 earnings per share for the current year.

Yum! Brands Dividend Announcement

The company also recently declared a quarterly dividend, which will be paid on Friday, June 12th. Investors of record on Wednesday, May 27th will be issued a dividend of $0.75 per share. This represents a $3.00 annualized dividend and a yield of 2.0%. The ex-dividend date of this dividend is Wednesday, May 27th. Yum! Brands's dividend payout ratio (DPR) is currently 48.39%.

Analysts Set New Price Targets

YUM has been the subject of a number of research reports. Morgan Stanley set a $180.00 price target on shares of Yum! Brands in a report on Friday, May 1st. Weiss Ratings downgraded shares of Yum! Brands from a "buy (b+)" rating to a "buy (b)" rating in a report on Wednesday, May 6th. Evercore reaffirmed an "outperform" rating and set a $190.00 price objective on shares of Yum! Brands in a report on Friday, February 13th. Wells Fargo & Company raised their price objective on shares of Yum! Brands from $160.00 to $165.00 and gave the stock an "equal weight" rating in a report on Thursday, April 30th. Finally, Deutsche Bank Aktiengesellschaft set a $177.00 price objective on shares of Yum! Brands in a report on Thursday, April 30th. Twelve research analysts have rated the stock with a Buy rating and eight have issued a Hold rating to the stock. According to MarketBeat, the company currently has an average rating of "Moderate Buy" and a consensus target price of $175.89.

Insider Activity

In related news, CEO Sean Tresvant sold 3,000 shares of Yum! Brands stock in a transaction dated Tuesday, May 26th. The shares were sold at an average price of $154.68, for a total transaction of $464,040.00. Following the completion of the transaction, the chief executive officer directly owned 3,140 shares of the company's stock, valued at $485,695.20. This trade represents a 48.86% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, CEO Scott Mezvinsky sold 277 shares of Yum! Brands stock in a transaction dated Friday, May 1st. The shares were sold at an average price of $160.48, for a total transaction of $44,452.96. Following the transaction, the chief executive officer directly owned 483 shares of the company's stock, valued at $77,511.84. This represents a 36.45% 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. Over the last quarter, insiders sold 5,364 shares of company stock valued at $827,837. Company insiders own 0.14% of the company's stock.

Yum! Brands Profile

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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