YUM
Yum Brands (NYSE: YUM) shares fell nearly 10% last week after a cyclosporiasis outbreak linked to shredded...
Article Summary
BUY- Yum Brands (NYSE: YUM) shares fell nearly 10% last week after a cyclosporiasis outbreak linked to shredded lettuce at some Taco Bell restaurants in the U.S. may dent sales but is unlikely to cause long-term damage, analysts say.
- Foot traffic at Taco Bell, owned by Yum Brands, was down 18.9% as of Friday, July 17, compared with Friday traffic on all Fridays from January 1 through July 6, according to Placerai data.
- The chain removed potentially affected lettuce from restaurants in select states as a precaution and stopped using iceberg lettuce supplied by Taylor Farms nationwide while the investigation continues.
- Taco Bell has been a key driver of Yum's growth outperforming many rivals despite broader weakness in the restaurant industry, and analysts and consultants say the outbreak would need to persist for months to materially damage the brand.
- Brands is scheduled to report quarterly results next week.
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Growth Stock Scoring Breakdown
| METRIC | VALUE | WEIGHT | ANALYSIS |
|---|---|---|---|
| Sales Growth TTM ? | 9.7% | 25% | 35.0 ptsBelow Screener (9.7%) - Weak growth |
| EPS Growth Next 5Y ? | 10.6% | 25% | 35.0 ptsBelow Screener (10.6%) - Modest outlook |
| Target Price Upside ? | 19.2% | 20% | 60.0 ptsModerate Upside (19.2%) - Target: $176.21 vs Current: $147.79 |
| Gross Margin % ? | 45.7% | 15% | 60.0 ptsSolid (45.7%) - Decent margins |
| Drawdown from 52-Wk High ? | -13.1% | 15% | 40.0 ptsMild Pullback (-13.1%) - Light entry opportunity |
Disclaimer: This rating is for informational purposes only and is not financial advice.
All data sourced from Finviz.
Always conduct your own research and consult with a financial advisor before making investment decisions.
Past performance does not guarantee future results.
About YUM
- Yum! Brands, Inc., together with its subsidiaries, develops, operates, and franchises traditional and non-traditional quick service restaurants in the United States, China, and internationally.
- The company operates in four segments: KFC Division, Taco Bell Division, Pizza Hut Division, and Habit Burger & Grill Division.
- It also operates restaurants under the KFC, Pizza Hut, Taco Bell, and Habit Burger & Grill brands, which specialize in chicken, Mexican-style food and pizza categories, made-to-order chargrilled burgers, sandwiches, and other products.
- The company was formerly known as TRICON Global Restaurants, Inc. and changed its name to Yum!
- Brands, Inc. in May 2002. Yum! Brands, Inc. was incorporated in 1997 and is headquartered in Louisville, Kentucky.