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1. Company Snapshot

1.a. Company Description

YUM! Brands, Inc., together with its subsidiaries, develops, operates, and franchises quick service restaurants worldwide.It operates through four segments: the KFC Division, the Taco Bell Division, the Pizza Hut Division, and the Habit Burger Grill Division.The company operates restaurants under the KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill brands, which specialize in chicken, pizza, made-to-order chargrilled burgers, sandwiches, Mexican-style food categories, and other food products.


As of December 31, 2021, it had 26,934 KFC units; 18,381 Pizza Hut units; 7,791 Taco Bell units; and 318 The Habit Burger Grill units in approximately 157 countries and territories.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.

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1.b. Last Insights on YUM

Yum! Brands' recent performance was driven by strong Q4 earnings, with a 12% increase in GAAP operating profit and a 11% growth in Core Operating Profit excluding the lap of the 53rd week. The company's digital momentum and global expansion contributed to EPS and sales growth, despite challenges at Pizza Hut and higher costs. Additionally, the company's dividend was increased, and several institutional investors, including Envestnet Asset Management Inc. and AE Wealth Management LLC, increased their stakes in the company.

1.c. Company Highlights

2. Yum! Brands Delivers Strong Q4 Results, Raises Bar for 2026

Yum! Brands reported a robust fourth quarter, with system sales growth of 5% driven by 3% unit growth and 3% same-store sales growth. The company's earnings per share (EPS) came in at $1.73, slightly below analyst estimates of $1.76. Revenue growth was led by strong performances from Taco Bell and KFC, with the former achieving 7% same-store sales growth and the latter delivering record-breaking unit development. The company's digital sales topped $11 billion, growing 25% year over year, and digital mix approaching 60%.

Publication Date: Feb -05

📋 Highlights
  • Taco Bell Market Share Growth:: Achieved 7% same-store sales growth, outperforming the QSR industry with digital sales contributing to 60% of total sales mix.
  • KFC Milestone Expansion:: Opened 1,100+ units in Q4 2025, reaching 30,000 international restaurants and driving 10% core operating profit growth.
  • Byte Platform Impact:: Processed 370M digital transactions in 2025, with Smart Ops reducing stockouts by 85% and Digital Ordering cutting aggregator failures by 75%.
  • Unit Development Record:: Opened 1,800+ new restaurants in Q4, totaling 4,550 annual openings, led by KFC’s expansion into 105 markets.

Segment Performance

Taco Bell gained market share, outperforming the QSR industry with exceptional same-store sales growth. KFC delivered a strong year with 6% system sales growth, resulting in a 10% core operating profit increase. The UK market saw a 10% increase in same-store sales in Q4, while the Middle East delivered high single-digit same-store sales growth.

Digital Capabilities and Byte by Yum

The company's digital capabilities continued to drive sales growth, with investments in the Byte by Yum platform, loyalty ecosystem, and AI-driven personalized marketing. Byte's digital ordering bundle expanded to five new markets and processed over 370 million digital transactions, representing over 60% growth year over year. The Smart Ops bundle, which includes point of sale, menu, and kitchen management, is used by over 7,000 restaurants.

Outlook and Valuation

For 2026, Yum! Brands expects to meet or exceed every component of its long-term growth algorithm, including delivering over 5% net new unit growth. The company's guidance implies a revenue growth rate of around 6.3%, in line with analyst estimates. With a current P/E Ratio of 28.45 and EV/EBITDA of 20.46, the stock appears to be reasonably valued. The Dividend Yield stands at 1.78%, providing a relatively stable return for investors. As Ranjith Roy, CFO, noted, "We are confident in meeting or exceeding every element of the algorithm in 2026, including the 8% operating profit growth."

Future Prospects

The company is focused on driving performance in all four brands and is reviewing strategic options for Pizza Hut. With a strong track record of unit growth, digital innovation, and a solid balance sheet, Yum! Brands is well-positioned for long-term success. The company's commitment to returning value to shareholders through dividends and share buybacks is evident, having returned approximately $1.35 billion to shareholders in 2025.

3. NewsRoom

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Yum! Brands, Inc. $YUM Shares Sold by Cibc World Market Inc.

Feb -15

Source: defenseworld.net

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Financial Analysis: SSP Group (OTCMKTS:SSPPF) & Yum! Brands (NYSE:YUM)

Feb -12

Source: defenseworld.net

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McDonald's vs. Yum! Brands: Which Wins the Battle for India as US Growth Slows?

Feb -11

Source: 247wallst.com

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Yum! Brands, Inc. $YUM Stock Holdings Lifted by Envestnet Asset Management Inc.

Feb -11

Source: defenseworld.net

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PIZZA HUT PARTNERS WITH BACKSTREET BOYS' NICK CARTER AND HOWIE DOROUGH TO CELEBRATE THE RETURN OF ITS ICONIC HEART-SHAPED PIZZA

Feb -10

Source: prnewswire.com

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Yum! Brands, Inc. $YUM Stock Position Cut by Allianz Asset Management GmbH

Feb -10

Source: defenseworld.net

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Yum! Brands, Inc. $YUM Stock Holdings Trimmed by Alps Advisors Inc.

Feb -10

Source: defenseworld.net

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Yum! Brands: The 'Taco Bell-ification' Of KFC (Rating Downgrade)

Feb -10

Source: seekingalpha.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (6.93%)

6. Segments

KFC Division

Expected Growth: 6.5%

KFC Division's 6.5% growth driven by digital transformation, expanding delivery and takeout services, menu innovation, and strategic marketing efforts. Additionally, investments in sustainability and customer experience enhancements have contributed to the segment's growth, attracting and retaining customers in a competitive fast-food market.

Taco Bell Division

Expected Growth: 7.5%

Taco Bell's 7.5% growth driven by menu innovation, aggressive expansion in international markets, and digital transformation through mobile ordering and delivery. Increased demand for affordable, convenient food options and successful marketing campaigns have also contributed to the division's growth within Yum! Brands, Inc.

Pizza Hut Division

Expected Growth: 6.0%

Pizza Hut's 6.0% growth driven by digital transformation, menu innovation, and delivery expansion. Increased online ordering, strategic partnerships, and revamped marketing efforts have boosted sales. Additionally, menu revamps and promotions have attracted new customers, contributing to the division's growth within Yum! Brands, Inc.

Habit Burger & Grill Division

Expected Growth: 8.0%

Habit Burger & Grill's 8.0% growth driven by menu innovation, aggressive expansion, and strong marketing efforts. Increased demand for fast-casual burgers and Habit's unique chargrilled offerings have fueled same-store sales growth, while Yum!'s resources and expertise have enabled accelerated unit growth and operational efficiencies.

Unallocated Franchise and Property

Expected Growth: 5.5%

Unallocated Franchise and Property growth of 5.5% for Yum! Brands, Inc. is driven by system-wide sales growth across KFC, Pizza Hut, and Taco Bell, increased franchise fees, and royalties. Additionally, strategic investments in digital transformation, marketing initiatives, and menu innovation contribute to the segment's growth.

7. Detailed Products

KFC (Kentucky Fried Chicken)

KFC is a fast-food restaurant chain that specializes in fried chicken and other chicken-based meals. The menu includes Original Recipe chicken, chicken sandwiches, chicken wings, and sides like mashed potatoes and coleslaw.

Pizza Hut

Pizza Hut is a fast-food restaurant chain that specializes in pizza and other Italian-American cuisine. The menu includes pizzas, pasta, wings, and sides like breadsticks and salads.

Taco Bell

Taco Bell is a fast-food restaurant chain that specializes in Mexican-inspired food. The menu includes tacos, burritos, quesadillas, and other items like nachos and value meals.

8. Yum! Brands, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Yum! Brands, Inc. faces a moderate threat from substitutes as consumers have various dining options, including fast-casual restaurants, full-service restaurants, and home-cooked meals. However, the company's diverse portfolio of brands, including KFC, Pizza Hut, and Taco Bell, allows it to cater to different tastes and preferences, mitigating the threat.

Bargaining Power Of Customers

Customers have limited bargaining power due to the low switching costs and the presence of multiple fast-food options. Additionally, Yum! Brands' loyalty programs and marketing efforts help to retain customers and reduce their bargaining power.

Bargaining Power Of Suppliers

Yum! Brands, Inc. has a large and diverse supplier base, which reduces the bargaining power of individual suppliers. The company's scale and market presence also enable it to negotiate favorable prices and terms with suppliers.

Threat Of New Entrants

The threat of new entrants is moderate due to the relatively low barriers to entry in the fast-food industry. However, Yum! Brands' established brands, extensive distribution network, and significant marketing budget create significant obstacles for new entrants.

Intensity Of Rivalry

The fast-food industry is highly competitive, with many established players, including McDonald's, Burger King, and Subway. Yum! Brands, Inc. faces intense rivalry from these competitors, which invest heavily in marketing, menu innovation, and promotions to attract customers.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 264.90%
Debt Cost 5.09%
Equity Weight -164.90%
Equity Cost 8.16%
WACC 0.02%
Leverage -160.64%

11. Quality Control: Yum! Brands, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
McDonald's

A-Score: 6.0/10

Value: 3.6

Growth: 4.7

Quality: 6.5

Yield: 4.0

Momentum: 7.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
Yum!

A-Score: 5.9/10

Value: 4.0

Growth: 4.7

Quality: 6.4

Yield: 4.0

Momentum: 7.0

Volatility: 9.3

1-Year Total Return ->

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Stock-Card
PulteGroup

A-Score: 5.8/10

Value: 6.0

Growth: 8.8

Quality: 7.7

Yield: 2.0

Momentum: 4.0

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
Booking

A-Score: 5.8/10

Value: 3.6

Growth: 8.7

Quality: 8.0

Yield: 1.0

Momentum: 5.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
Starbucks

A-Score: 5.0/10

Value: 3.3

Growth: 5.6

Quality: 4.5

Yield: 5.0

Momentum: 4.0

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
Chipotle Mexican Grill

A-Score: 3.8/10

Value: 1.2

Growth: 8.4

Quality: 5.9

Yield: 0.0

Momentum: 1.0

Volatility: 6.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

162.91$

Current Price

162.91$

Potential

0.00%

Expected Cash-Flows