Yum! Brands (YUM) Hits 52-Week High

NEW YORK ( TheStreet) - Yum! Brands ( YUM) hit a 52-week high on Tuesday after the stock received an outperform rating by Oppenheimer analysts on Monday.

"Since October 2011, the stock is up 43% (vs. S&P's 28%), but our analysis suggests incremental upside to both earnings and valuation," Oppenheimer analysts wrote in a report Monday. "We are attracted to the unique business model that continues to shift toward emerging economies (now 60% of profits) which boosts ROIC and could extend the double-digit earnings runway for several years. Importantly, company-specific tailwinds in China (~45% of profits) are powerful and appear uncorrelated to slowing GDP. The reliable free cash flow stream could generate well over $1 billion in 2012 and lead to earnings-accretive share buybacks and double-digit dividend raises."

Shares of Yum! Brands hit a 52-week high Tuesday of $69.75. The stock's 52-week low of $47.15 was set on Oct. 4.

Yum! Brands has an estimated price-to-earnings ratio for next year of 18.53 times; the average for restaurant and bar companies is 19.96. For comparison, both Chipotle Mexican Grill ( CMG) and Panera Bread ( PNRA) have higher forward P/Es of 37.76 and 24.26, respectively.

Sixteen of the 23 analysts who cover Yum! Brands rated it buy; seven analysts gave the stock a hold rating.

TheStreet Ratings gives Yum! Brands an A+ grade with a buy rating and a $84.88 price target. The stock has risen 17.91% year to date.

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

-- Written by Alexandra Zendrian

>To contact the writer of this article, click here: Alexandra Zendrian

>To submit a news tip, send an email to: tips@thestreet.com.

>To follow the writer on Twitter, go to Alexandra Zendrian.

If you liked this article you might like

Pizza Hut to Deliver 15 Degrees Hotter Pizza on National Pepperoni Pizza Day

Taco Bell Opening 300 Locations That Have No Drive-Thru But Sell Lots of Alcohol

Equifax CEO and Board Are Pretty Cozy

Alibaba Gets in On Apple's Facial Recognition Thing

Walmart, Starbucks Respond to Hurricanes the Best -- Others? Not So Much