Yum! Brands Inc (YUM) Stock Analysis
Verdict: WATCH (do not buy)
Taco Bell foot-traffic drag pushes YUM to 52-week lows, creating a valuation floor backed by $1.64B FCF despite $11.9B debt burden.
Investment score: 48/100
Analysis as of
Is Yum! Brands Inc stock worth reviewing? The TradeMates thesis
The model sees YUM as a high-margin franchising cash cow currently weighed down by temporary Taco Bell foot-traffic slumps and industry macro headwinds. While $1.64B in annual FCF and a discounted 17.11x P/E offer a solid long-term floor, a high net leverage of 4.02x and severe negative momentum near 52-week lows ($136.91) justify a HOLD recommendation.
7-factor investment score
- Valuation: 60/100 (weight 20%)
- Financial Health: 50/100 (weight 15%)
- Technical Momentum: 25/100 (weight 15%)
- Earnings Quality: 65/100 (weight 15%)
- Insider Sentiment: 20/100 (weight 10%)
- Analyst Consensus: 65/100 (weight 10%)
- Risk-Adjusted Return: 45/100 (weight 15%)
Yum! Brands Inc opportunities and risks
What speaks for YUM
- Asset-light franchising model drives industry-leading operating margin of 31.0%.
What speaks against YUM
- Persistent foot-traffic drop at Taco Bell from health outbreak fallout.
Peers and competitors
| Ticker | P/E | P/S | EV/EBITDA | Gross margin | Net margin | FCF yield |
|---|---|---|---|---|---|---|
| YUM | 17.1x | 4.3x | 17.1x | 45.8% | 25.4% | 4.4% |
| MCD | 20.2x | 6.4x | 15.3x | 57.4% | 31.7% | 4.4% |
| SBUX | 55.6x | 2.9x | 22.0x | 31.7% | 5.2% | 3.3% |
| DASH | 100.8x | 5.4x | 45.0x | 51.4% | 5.3% | 2.8% |
| CMG | 31.0x | 3.5x | 21.4x | 24.1% | 11.4% | 3.6% |
| QSR | 18.1x | 2.7x | 14.4x | 44.8% | 13.1% | 6.1% |
| Peer median | 31.0x | 3.5x | 21.4x | 44.8% | 11.4% | 3.6% |
Frequently asked questions about Yum! Brands Inc (YUM)
Is YUM stock a good investment?
The TradeMates model rates Yum! Brands Inc as WATCH (do not buy) with an investment score of 48/100. The model sees YUM as a high-margin franchising cash cow currently weighed down by temporary Taco Bell foot-traffic slumps and industry macro headwinds. While $1.64B in annual FCF and a discounted 17.11x P/E offer a solid long-term floor, a high net leverage of 4.02x and severe negative momentum near 52-week lows ($136.91) justify a HOLD recommendation. This is algorithmic model output, not personal investment advice.
Is YUM stock a buy?
The TradeMates model verdict for YUM is WATCH (do not buy) with an investment score of 48/100. Treat this as a model signal to review, not a personal buy recommendation.