Wellington Management Group LLP Boosts Holdings in Yum! Brands, Inc. $YUM

Key Points

• Wellington Management significantly increased its Yum! Brands stake by 1,373.2% in the second quarter, acquiring 4.32 million additional shares. It now owns 4.63 million shares, or 1.70% of the company, valued at approximately $740.5 million.
• Yum! Brands exceeded quarterly earnings expectations, reporting $1.62 in EPS versus the $1.58 consensus estimate, while revenue rose 12.2% year over year to $2.17 billion. The company also authorized a $4 billion share-repurchase program and maintains a $0.75 quarterly dividend.
• Analysts hold a consensus “Moderate Buy” rating with an average price target of $174.65, compared with shares opening at $154.08. Insiders, however, sold 19,043 shares worth about $3.0 million over the past 90 days.

Wellington Management Group LLP lifted its holdings in Yum! Brands, Inc. (NYSE:YUM - Free Report) by 1,373.2% in the second quarter, according to the company in its most recent filing with the SEC. The fund owned 4,631,940 shares of the restaurant operator's stock after acquiring an additional 4,317,526 shares during the quarter. Wellington Management Group LLP owned 1.70% of Yum! Brands worth $740,462,000 at the end of the most recent quarter.

Other institutional investors and hedge funds also recently made changes to their positions in the company. Hsbc Holdings PLC increased its stake in Yum! Brands by 5.9% in the 4th quarter. Hsbc Holdings PLC now owns 569,676 shares of the restaurant operator's stock worth $86,197,000 after purchasing an additional 31,836 shares during the period. Bleakley Financial Group LLC bought a new stake in Yum! Brands in the first quarter valued at approximately $1,589,000. Mitsubishi UFJ Asset Management Co. Ltd. boosted its stake in shares of Yum! Brands by 5.4% during the fourth quarter. Mitsubishi UFJ Asset Management Co. Ltd. now owns 584,953 shares of the restaurant operator's stock valued at $88,030,000 after purchasing an additional 30,075 shares during the period. AustralianSuper Pty Ltd bought a new position in shares of Yum! Brands in the fourth quarter worth approximately $1,264,000. Finally, QRG Capital Management Inc. grew its holdings in shares of Yum! Brands by 19.8% in the first quarter. QRG Capital Management Inc. now owns 103,807 shares of the restaurant operator's stock worth $16,140,000 after purchasing an additional 17,189 shares during the last quarter. Institutional investors own 82.37% of the company's stock.

Insider Activity at Yum! Brands

In related news, VP David Eric Russell sold 7,961 shares of the company's stock in a transaction on Monday, August 3rd. The stock was sold at an average price of $153.15, for a total value of $1,219,227.15. Following the sale, the vice president directly owned 11,960 shares of the company's stock, valued at $1,831,674. This represents a 39.96% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, COO Tracy L. Skeans sold 3,494 shares of the stock in a transaction on Monday, August 24th. The stock was sold at an average price of $158.00, for a total value of $552,052.00. Following the completion of the transaction, the chief operating officer owned 3 shares of the company's stock, valued at approximately $474. This trade represents a 99.91% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 19,043 shares of company stock valued at $2,978,180 over the last ninety days. Insiders own 0.14% of the company's stock.

Yum! Brands Price Performance

Shares of NYSE YUM opened at $154.08 on Friday. Yum! Brands, Inc. has a 1 year low of $137.33 and a 1 year high of $170.14. The stock has a market capitalization of $42.05 billion, a P/E ratio of 19.38, a P/E/G ratio of 2.50 and a beta of 0.55. The company's 50-day moving average is $153.48 and its 200 day moving average is $155.81.

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

Yum! Brands announced that its board 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 buy up to 9.4% of its shares through open market purchases. Shares buyback programs are usually a sign that the company's board of directors believes its stock is undervalued.

Yum! Brands Dividend Announcement

The company also recently announced a quarterly dividend, which will be paid on Friday, September 18th. Stockholders of record on Wednesday, September 9th will be paid a $0.75 dividend. This represents a $3.00 dividend on an annualized basis and a dividend yield of 1.9%. The ex-dividend date is Wednesday, September 9th. Yum! Brands's dividend payout ratio (DPR) is presently 37.74%.

Wall Street Analysts Forecast Growth

A number of equities analysts have issued reports on the stock. Argus decreased their price objective on shares of Yum! Brands from $185.00 to $180.00 and set a "buy" rating on the stock in a research report on Monday, August 17th. TD Cowen reissued a "buy" rating and issued a $180.00 target price on shares of Yum! Brands in a research note on Tuesday, June 16th. JPMorgan Chase & Co. reduced their price target on Yum! Brands from $170.00 to $160.00 and set an "overweight" rating on the stock in a report on Tuesday, August 4th. Evercore reaffirmed an "outperform" rating on shares of Yum! Brands in a research report on Tuesday, June 16th. Finally, Citigroup increased their price objective on Yum! Brands from $175.00 to $178.00 and gave the stock a "neutral" rating in a report on Sunday, July 12th. One analyst has rated the stock with a Strong Buy rating, twelve have given a Buy rating, seven have assigned a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, the company has a consensus rating of "Moderate Buy" and a consensus target price of $174.65.

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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