/Yum%20Brands%20Inc_%20sign%20by-%20JHVEPhoto%20via%20iStock.jpg)
Valued at a market cap of $38.6 billion, Yum! Brands, Inc. (YUM) develops, operates, and franchises quick service restaurants under its KFC, Pizza Hut, Taco Bell, and Habit Burger Grill brand names. The Louisville, Kentucky-based company specializes in chicken, pizza, made-to-order chargrilled burgers, sandwiches, and Mexican-style food categories.
Companies worth $10 billion or more are generally described as “large-cap” stocks, and Yum! Brands fit right into that category with its market cap exceeding this threshold. The fast-food chain owns, operates, and franchises restaurants in more than 150 countries and territories and exercises store-level franchise and master franchise programs to grow its businesses.
YUM has slipped 3.5% from its 52-week high of $143.20, achieved on Apr. 29. Shares of YUM have gained 4% over the past three months, lagging behind the broader Dow Jones Industrials Average’s ($DOWI) 8.6% gains over the same time frame.
Moreover, in the longer term, YUM has gained 5.8% on a YTD basis, underperforming DOWI’s 17.4% returns. Shares of YUM are up 11.2% over the past 52 weeks, lagging behind DOWI’s 22.1% gains over the same time frame.
Yet, YUM stock appears to be trading above its 200-day and 50-day moving average since late November.
On Nov. 5, YUM shares gained 1.5% following its Q3 earnings release despite delivering a weaker-than-expected performance. The company’s revenue of $1.83 billion increased 7% from a year ago but missed the consensus estimates of $1.89 billion. Soft contributions from the company’s Pizza Hut division partially offset the robust performance of its Taco Bell and KFC divisions. Moreover, its adjusted earnings declined 4.9% year-over-year to $1.37 per share and fell short of the forecasted figure by 2.8%.
Yet, YUM has outperformed its rival, McDonald's Corporation (MCD), which gained 5.3% over the past 52 weeks and 1.4% on a YTD basis.
Although YUM has recently underperformed the broader market, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from the 27 analysts covering it, and the mean price target of $144.30 suggests a 4.4% premium to its current levels.
