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Based in Louisville, Kentucky, Yum! Brands, Inc. (YUM) develops, operates, and franchises quick-service restaurants worldwide. Valued at a market cap of $37.6 billion, the company operates restaurants under the KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill brands.
Companies valued at $10 billion or more are classified as “large-cap” stocks, and Yum! Brands fits right into that category. The company owns, operates, and franchises restaurants in more than 150 countries.
YUM shares are trading 6.8% below their 52-week high of $143.20, which they hit on Apr. 29. The stock has declined 3.3% over the past three months, underperforming the broader Nasdaq Composite ($NASX), which has marginally gained over the same time frame.
In the longer term, YUM stock is up 2.1% on a YTD basis, lagging behind NASX’s 17.8% gains. Moreover, shares of YUM have gained 3.4% over the past 52 weeks, significantly underperforming NASX’s 28% returns over the same time frame.
To confirm its bearish trend, YUM has been trading below its 200-day moving average since early September. However, it has remained above its 50-day moving average since late July, indicating a bullish trend.
On Aug. 6, YUM gained 2.7% following its Q2 earnings release. The company reported a profit of $367 million, or $1.35 per share, surpassing Wall Street expectations of $1.32 per share. However, its revenue reached $1.76 billion, missing the analysts’ expectation of $1.80 billion. Despite the revenue shortfall, the company maintained its outlook, expecting strong growth in 2025, backed by its strategic focus on digital and technological expansions, including Voice AI and AI-enabled systems.
YUM has surpassed its rival McDonald's Corporation’s (MCD) marginal decline on a YTD basis but has lagged behind MCD’s 4.6% gain over the past 52 weeks.
Despite YUM’s recent underperformance, analysts remain moderately optimistic about its prospects. The stock has a consensus rating of “Moderate Buy” from 26 analysts in coverage, and the mean price target of $145.61 suggests a 9.2% premium to its current levels.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
