Weiss Asset Management LP Makes New Investment in Yum! Brands, Inc. $YUM

Key Points

• Weiss Asset Management initiated a Yum! Brands position by purchasing 8,085 shares worth approximately $1.26 million. Institutional investors and hedge funds collectively own 82.37% of the company.
• Analysts maintain a generally positive outlook, with a consensus “Moderate Buy” rating and an average price target of $174.81. Yum! recently exceeded quarterly earnings expectations, reporting $1.50 in EPS and $2.06 billion in revenue.
• Yum! authorized a $4 billion share-repurchase program, covering up to 9.4% of outstanding shares, and maintains a quarterly dividend of $0.75 per share, or a 2.0% annual yield.

Weiss Asset Management LP bought a new stake in Yum! Brands, Inc. (NYSE:YUM - Free Report) during the 1st quarter, according to the company in its most recent disclosure with the Securities & Exchange Commission. The fund bought 8,085 shares of the restaurant operator's stock, valued at approximately $1,257,000.

Other institutional investors and hedge funds have also made changes to their positions in the company. Brighton Jones LLC boosted its holdings in Yum! Brands by 8.0% in the 4th quarter. Brighton Jones LLC now owns 7,861 shares of the restaurant operator's stock valued at $1,055,000 after purchasing an additional 583 shares in the last quarter. First Trust Advisors LP increased its position in Yum! Brands by 124.5% during the 2nd quarter. First Trust Advisors LP now owns 151,316 shares of the restaurant operator's stock worth $22,422,000 after purchasing an additional 83,916 shares during the period. CIBC Asset Management Inc raised its stake in shares of Yum! Brands by 10.0% during the 2nd quarter. CIBC Asset Management Inc now owns 117,824 shares of the restaurant operator's stock worth $17,447,000 after buying an additional 10,755 shares in the last quarter. Treasurer of the State of North Carolina raised its stake in shares of Yum! Brands by 1.0% during the 2nd quarter. Treasurer of the State of North Carolina now owns 130,205 shares of the restaurant operator's stock worth $19,294,000 after buying an additional 1,256 shares in the last quarter. Finally, HUB Investment Partners LLC lifted its holdings in shares of Yum! Brands by 59.1% in the 2nd quarter. HUB Investment Partners LLC now owns 2,319 shares of the restaurant operator's stock valued at $344,000 after buying an additional 861 shares during the period. 82.37% of the stock is currently owned by institutional investors and hedge funds.

Insider Buying and Selling

In related news, COO Tracy L. Skeans sold 1,837 shares of Yum! Brands stock in a transaction that occurred on Friday, May 15th. The stock was sold at an average price of $152.00, for a total transaction of $279,224.00. Following the completion of the transaction, the chief operating officer directly owned 3,497 shares in the company, valued at $531,544. The trade was a 34.44% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available at this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Christopher Lee Turner sold 250 shares of Yum! Brands stock in a transaction that occurred on Wednesday, July 1st. The stock was sold at an average price of $160.42, for a total value of $40,105.00. Following the transaction, the chief executive officer owned 64,032 shares of the company's stock, valued at $10,272,013.44. This represents a 0.39% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders have sold 12,423 shares of company stock valued at $1,953,721. 0.14% of the stock is owned by company insiders.

Analyst Ratings Changes

A number of research firms recently weighed in on YUM. Evercore restated an "outperform" rating on shares of Yum! Brands in a research note on Tuesday, June 16th. BMO Capital Markets reiterated a "market perform" rating and issued a $168.00 price objective on shares of Yum! Brands in a research report on Monday, May 4th. Morgan Stanley raised Yum! Brands from an "equal weight" rating to an "overweight" rating and raised their target price for the company from $180.00 to $185.00 in a report on Wednesday, June 3rd. Deutsche Bank Aktiengesellschaft set a $177.00 target price on shares of Yum! Brands in a research report on Thursday, April 30th. Finally, Wells Fargo & Company upped 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 note on Thursday, April 30th. Eleven equities research analysts have rated the stock with a Buy rating and seven have assigned a Hold rating to the company. According to data from MarketBeat.com, Yum! Brands currently has a consensus rating of "Moderate Buy" and an average price target of $174.81.

Yum! Brands Stock Down 0.6%

Shares of YUM stock opened at $147.99 on Tuesday. Yum! Brands, Inc. has a fifty-two week low of $137.33 and a fifty-two week high of $170.14. The stock has a market cap of $40.79 billion, a P/E ratio of 23.87, a P/E/G ratio of 1.88 and a beta of 0.56. The business has a fifty day simple moving average of $153.98 and a 200-day simple moving average of $156.73.

Yum! Brands (NYSE:YUM - Get Free Report) last released its quarterly earnings data on Wednesday, April 29th. The restaurant operator reported $1.50 EPS for the quarter, topping the consensus estimate of $1.39 by $0.11. The business had revenue of $2.06 billion for the quarter, compared to analyst estimates of $2.04 billion. Yum! Brands had a net margin of 20.48% and a negative return on equity of 23.51%. The business's revenue for the quarter was up 15.2% compared to the same quarter last year. During the same period in the previous year, the firm earned $1.30 EPS. On average, sell-side analysts anticipate that Yum! Brands, Inc. will post 6.74 earnings per share for the current year.

Yum! Brands declared that its board has authorized a share buyback program on Tuesday, June 16th that authorizes the company to repurchase $4.00 billion in shares. This repurchase authorization authorizes the restaurant operator to repurchase up to 9.4% of its shares through open market purchases. Shares repurchase programs are typically an indication that the company's leadership believes its stock is undervalued.

Yum! Brands Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Friday, June 12th. Shareholders of record on Wednesday, May 27th were issued a $0.75 dividend. This represents a $3.00 annualized dividend and a dividend yield of 2.0%. The ex-dividend date of this dividend was Wednesday, May 27th. Yum! Brands's dividend payout ratio is 48.39%.

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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