Yum Brands Inc

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YUM : NYSE : Services
$75.41 | %
Today's Range: 75.0 - 75.73
Avg. Daily Volume: 1975500.0
08/18/17 - 4:06 PM ET

Financial Analysis

YUM BRANDS INC's gross profit margin for the second quarter of its fiscal year 2017 has increased when compared to the same period a year ago. Sales and net income have dropped, underperforming the average competitor within its industry. YUM BRANDS INC has weak liquidity. Currently, the Quick Ratio is 0.93 which shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year.

At the same time, stockholders' equity ("net worth") has significantly decreased by 1,468.63% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)1448.01509.0
EBITDA ($mil)515.0495.0
EBIT ($mil)450.0421.0
Net Income ($mil)206.0336.0

Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)1023.0846.0
Total Assets ($mil)5596.08184.0
Total Debt ($mil)9849.05363.0
Equity ($mil)-6102.0-389.0

Profitability Q2 FY17 Q2 FY16
Gross Profit Margin52.8349.3
EBITDA Margin35.5632.8
Operating Margin31.0827.9
Sales Turnover1.121.26
Return on Assets25.5317.05
Return on Equity0.00.0
Debt Q2 FY17 Q2 FY16
Current Ratio1.210.82
Interest Expense102.051.0
Interest Coverage4.418.25

Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)345.0399.0
Div / share0.30.46
Book value / share-17.69-0.97
Institutional Own % n/a n/a
Avg Daily Volume2020806.02777397.0


HOLD. This stock's P/E ratio indicates a significant discount compared to an average of 41.67 for the Hotels, Restaurants & Leisure industry and a premium compared to the S&P 500 average of 24.31. Normally, for additional comaprison, we would look at the price-to-book ratio; however, this company's price-to-book ratio is negative making the value useless for comparisons. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, YUM BRANDS INC proves to trade at a discount to investment alternatives within the industry.

1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
YUM 27.60 Peers 41.67   YUM 15.85 Peers 19.65

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

YUM is trading at a significant discount to its peers.


Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

YUM is trading at a discount to its peers.

1 2 3 4 5
premium   discount
  Price to
1 2 3 4 5
premium   discount
YUM 23.51 Peers 24.25   YUM 2.03 Peers 2.81

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

YUM is trading at a premium to its peers.


Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

YUM trades at a significant discount to its peers.

1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
YUM NM Peers 10.01   YUM -1.09 Peers 53.47

Neutral. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

YUM's P/B is negative making this valuation measure meaningless.


Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, YUM is expected to significantly trail its peers on the basis of its earnings growth rate.

1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
YUM 4.15 Peers 3.23   YUM -39.32 Peers 7.46

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

YUM is trading at a significant premium to its industry.


Lower. A sales growth rate that trails the industry implies that a company is losing market share.

YUM significantly trails its peers on the basis of sales growth



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