NEW YORK (TheStreet) -- Shares of Yum China Holdings (YUMC) were lower in afternoon trading on Monday after research analysts at CLSA initiated coverage of the stock with an "underperform" rating and a $30 price target.
CLSA is a Hong Kong-based equity brokerage and investment group.
"CLSA is very wise when it comes to these Asian names," Ritholtz Wealth Management CEO Josh Brown said on CNBC's "Halftime Report" today.
He respects the firm's rating, but reaffirmed both his positions in Yum China and its parent company Yum! Brands (YUM) .
"I think the history with these types of spinoffs -- ultimately, you are rewarded as a shareholder," Brown contended.
Regarding potential headwinds from competition within China, Brown believes the size of the Chinese market diminishes that threat.
"I think there is always competition, but think about the total addressable market in China. At what point is there ever real competition?" Brown questioned.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author. TheStreet Ratings has this to say about the recommendation:
We rate YUM BRANDS INC as a Hold with a ratings score of C+. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.