Yum! Brands, Inc. (NYSE:YUM) Receives Consensus Rating of "Moderate Buy" from Analysts

Key Points

• Analysts maintain a “Moderate Buy” consensus on Yum! Brands, with 12 buys and seven holds among 19 analysts. The average 12-month price target is approximately $174.65, versus shares opening at $152.24.
• Yum! Brands exceeded quarterly EPS expectations, reporting $1.62 versus the $1.58 consensus, while revenue rose 12.2% year over year to $2.17 billion. The company also authorized a $4 billion share repurchase program, covering up to 9.4% of outstanding stock.
• Insiders have sold 18,549 shares worth approximately $2.89 million over the past 90 days, while institutional investors own 82.37% of the company. The investment outlook is supported by AI, automation and digital-loyalty initiatives but tempered by legal-investigation concerns and mixed analyst forecasts.

Shares of Yum! Brands, Inc. (NYSE:YUM - Get Free Report) have been given an average rating of "Moderate Buy" by the nineteen ratings firms that are presently covering the stock, MarketBeat reports. Seven investment analysts have rated the stock with a hold rating and twelve have given a buy rating to the company. The average 12 month price objective among brokerages that have updated their coverage on the stock in the last year is $174.6471.

Several equities research analysts have recently issued reports on the stock. Weiss Ratings downgraded shares of Yum! Brands from a "buy (b)" rating to a "buy (b-)" rating in a research report on Tuesday, July 28th. Citigroup boosted their price objective on shares of Yum! Brands from $175.00 to $178.00 and gave the company a "neutral" rating in a research report on Sunday, July 12th. Argus reduced their target price on shares of Yum! Brands from $185.00 to $180.00 and set a "buy" rating for the company in a research note on Monday. BMO Capital Markets reiterated a "market perform" rating and set a $168.00 target price on shares of Yum! Brands in a report on Monday, May 4th. Finally, Morgan Stanley raised Yum! Brands from an "equal weight" rating to an "overweight" rating and lifted their price target for the company from $180.00 to $185.00 in a research note on Wednesday, June 3rd.

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.

Institutional Inflows and Outflows

Hedge funds have recently added to or reduced their stakes in the business. Harrell Investment Partners LLC raised its position in Yum! Brands by 1.5% in the 2nd quarter. Harrell Investment Partners LLC now owns 4,235 shares of the restaurant operator's stock worth $677,000 after purchasing an additional 62 shares during the period. Magnolia Capital Advisors LLC boosted its position in shares of Yum! Brands by 2.0% during the fourth quarter. Magnolia Capital Advisors LLC now owns 3,292 shares of the restaurant operator's stock valued at $498,000 after buying an additional 63 shares during the period. Econ Financial Services Corp grew its stake in shares of Yum! Brands by 0.4% during the first quarter. Econ Financial Services Corp now owns 15,536 shares of the restaurant operator's stock valued at $2,416,000 after buying an additional 63 shares during the last quarter. Essex Financial Services Inc. grew its stake in shares of Yum! Brands by 1.0% during the fourth quarter. Essex Financial Services Inc. now owns 6,667 shares of the restaurant operator's stock valued at $1,009,000 after buying an additional 66 shares during the last quarter. Finally, Hilltop Holdings Inc. raised its holdings in shares of Yum! Brands by 2.8% in the fourth quarter. Hilltop Holdings Inc. now owns 2,525 shares of the restaurant operator's stock worth $382,000 after buying an additional 68 shares during the period. Institutional investors own 82.37% of the company's stock.

Yum! Brands News Summary

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 Stock Performance

Shares of YUM opened at $152.24 on Friday. The stock has a 50 day simple moving average of $153.45 and a 200 day simple moving average of $156.00. Yum! Brands has a 52-week low of $137.33 and a 52-week high of $170.14. The firm has a market capitalization of $41.55 billion, a PE ratio of 19.15, a P/E/G ratio of 2.37 and a beta of 0.55.

Yum! Brands (NYSE:YUM - Get Free Report) last announced its earnings results on Thursday, July 30th. The restaurant operator reported $1.62 EPS for the quarter, topping the consensus estimate 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 firm had revenue of $2.17 billion for the quarter, compared to the consensus estimate of $2.18 billion. During the same period last year, the company posted $1.44 EPS. The business's quarterly revenue was up 12.2% on a year-over-year basis. Equities research analysts predict that Yum! Brands will post 6.42 EPS for the current fiscal year.

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

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.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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