Paralel Advisors LLC Makes New Investment in Yum! Brands, Inc. $YUM

Key Points

• Paralel Advisors LLC acquired 425,000 Yum! Brands shares worth approximately $67.9 million during the second quarter, making YUM its 11th-largest holding and representing about 2.6% of its portfolio.
• Yum! Brands reported quarterly EPS of $1.62, beating estimates of $1.58, while revenue rose 12.2% year over year to $2.17 billion. The board also authorized a $4 billion share-repurchase program, covering up to 9.4% of outstanding shares.
• Analyst sentiment remains generally positive, with a “Moderate Buy” consensus and an average price target of $174.65, though Argus lowered its target and Pomerantz is investigating potential investor claims, adding uncertainty.

Paralel Advisors LLC bought a new position in shares of Yum! Brands, Inc. (NYSE:YUM - Free Report) during the second quarter, according to the company in its most recent disclosure with the Securities & Exchange Commission. The fund bought 425,000 shares of the restaurant operator's stock, valued at approximately $67,940,000. Yum! Brands accounts for about 2.6% of Paralel Advisors LLC's portfolio, making the stock its 11th biggest holding. Paralel Advisors LLC owned about 0.16% of Yum! Brands at the end of the most recent reporting period.

Several other large investors have also recently added to or reduced their stakes in the company. Steph & Co. raised its stake in shares of Yum! Brands by 107.5% in the first quarter. Steph & Co. now owns 166 shares of the restaurant operator's stock valued at $26,000 after purchasing an additional 86 shares in the last quarter. Edmond DE Rothschild Holding S.A. bought a new position in Yum! Brands during the 2nd quarter valued at about $27,000. MV Capital Management Inc. acquired a new position in shares of Yum! Brands in the 4th quarter worth approximately $28,000. Manning & Napier Advisors LLC acquired a new position in Yum! Brands in the first quarter worth $28,000. Finally, Wiser Advisor Group LLC acquired a new position in Yum! Brands during the 3rd quarter worth about $28,000. Institutional investors and hedge funds own 82.37% of the company's stock.

Yum! Brands News Roundup

Here are the key news stories impacting Yum! Brands this week:

• Positive Sentiment: Yum! Brands’ investment narrative is increasingly centered on artificial intelligence, automation, digital loyalty and personalized app experiences. Management is using these tools across Taco Bell, KFC and Pizza Hut to improve delivery, inventory management and customer engagement, potentially supporting efficiency and sales growth. How Yum! Brands’ AI Automation And Loyalty Push Has Changed Its Investment Story
• Positive Sentiment: One valuation analysis argues that YUM could be approximately 19% below fair value, offering potential upside if investors view the company’s long-term brand strength, technology investments and international growth favorably. The appointment of director Kathleen Oberg to the Audit Committee was also highlighted as a governance development. Yum! Brands Could Be 19% Below Fair Value After Audit Committee Change
• Neutral Sentiment: Executive Sean Tresvant reported restricted stock unit vesting and the withholding of shares to cover taxes. The filing is generally routine and does not necessarily signal a change in management’s view of the company. Yum Brands Executive Sean Tresvant Reports RSU Vesting and Tax-Related Share Withholding
• Neutral Sentiment: Analyst roundups from Zacks and other market commentators provide additional coverage of YUM but do not identify a decisive new earnings or operating catalyst. The Zacks Analyst Blog Highlights McDonald’s, Starbucks and Yum! Brands
• Negative Sentiment: Pomerantz LLP is investigating potential claims on behalf of Yum! Brands investors. Although no finding of wrongdoing was reported, the investigation creates legal and reputational uncertainty. Pomerantz Law Firm Investigates Claims on Behalf of Yum! Brands Investors
• Negative Sentiment: Argus issued a pessimistic forecast for YUM, tempering the more optimistic fair-value commentary and suggesting concern about the stock’s near-term risk-reward profile. Argus Issues Pessimistic Forecast for Yum! Brands Stock

Yum! Brands Trading Up 4.3%

YUM stock opened at $152.24 on Friday. The stock has a 50-day moving average price of $153.45 and a two-hundred day moving average price of $156.00. The stock has a market cap of $41.55 billion, a PE ratio of 19.15, a price-to-earnings-growth ratio of 2.37 and a beta of 0.55. Yum! Brands, Inc. has a 1 year low of $137.33 and a 1 year high of $170.14.

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

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

Insiders Place Their Bets

In other news, CEO Sean Tresvant sold 3,000 shares of the firm's stock in a transaction that occurred on 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 legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, CEO Scott Mezvinsky sold 268 shares of Yum! Brands stock in a transaction that occurred on Monday, August 3rd. The shares were sold at an average price of $153.15, for a total transaction of $41,044.20. Following the completion of the sale, the chief executive officer owned 483 shares in the company, valued at $73,971.45. This trade 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 have sold 18,549 shares of company stock worth $2,890,168 in the last 90 days. Company insiders own 0.14% of the company's stock.

Analysts Set New Price Targets

Several research analysts have issued reports on the company. UBS Group reaffirmed a "buy" rating on shares of Yum! Brands in a report on Thursday, June 18th. TD Cowen reissued a "buy" rating and set a $180.00 price objective on shares of Yum! Brands in a research note on Tuesday, June 16th. Royal Bank Of Canada increased their price target on Yum! Brands from $165.00 to $170.00 and gave the stock a "sector perform" rating in a report on Friday, July 31st. Weiss Ratings cut Yum! Brands from a "buy (b)" rating to a "buy (b-)" rating in a report on Tuesday, July 28th. Finally, Argus decreased their price objective on Yum! Brands from $185.00 to $180.00 and set a "buy" rating for the company in a research report on Monday. Twelve equities research analysts have rated the stock with a Buy rating and seven have given a Hold rating to the company's stock. According to data from MarketBeat, the company presently has an average rating of "Moderate Buy" and a consensus target price of $174.65.

Yum! Brands Company 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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