Yum China (YUMC) Rating Increased to Hold at Zacks Investment Research
Yum China (NYSE:YUMC) was upgraded by Zacks Investment Research from a “sell” rating to a “hold” rating in a report released on Wednesday.
According to Zacks, “Shares of Yum China have underperformed its industry in the past year. Despite its earnings surpassing the Zacks Consensus Estimate in the second quarter of 2018, we are apprehensive of the company’s Pizza Hut sales trend in the recent quarters. Moreover, increased costs from labor, rent and operational initiatives hurt the company’s margins. Further, a lesser franchised business model remains a concern. Estimates for 2018 have remained unchanged over the past month, limiting upside potential for the stock. However, differentiated menu offerings across its restaurants and the enhanced focus on delivery system are the major top-line drivers. Continual expansion through unit openings also bodes well.”
YUMC has been the topic of several other research reports. Macquarie downgraded Yum China from an “outperform” rating to a “neutral” rating in a research report on Thursday, August 2nd. Oppenheimer downgraded Yum China from an “outperform” rating to a “market perform” rating and set a $33.00 target price on the stock. in a research report on Friday, August 17th. Bank of America downgraded Yum China from a “neutral” rating to an “underperform” rating and dropped their target price for the stock from $44.30 to $34.00 in a research report on Thursday, July 19th. Finally, UBS Group downgraded Yum China from an “outperform” rating to a “market perform” rating in a research report on Friday, August 17th. One research analyst has rated the stock with a sell rating, four have given a hold rating and one has assigned a buy rating to the company’s stock. The stock has a consensus rating of “Hold” and an average target price of $42.50.
Yum China (NYSE:YUMC) last posted its earnings results on Wednesday, August 1st. The company reported $0.36 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.33 by $0.03. The firm had revenue of $2.07 billion for the quarter, compared to the consensus estimate of $2.10 billion. Yum China had a return on equity of 20.94% and a net margin of 6.45%. The business’s quarterly revenue was up 12.3% on a year-over-year basis. During the same quarter in the prior year, the business posted $0.27 earnings per share. On average, analysts expect that Yum China will post 1.51 earnings per share for the current fiscal year.
In related news, insider Angela Ai sold 4,529 shares of the stock in a transaction on Friday, September 7th. The stock was sold at an average price of $38.25, for a total value of $173,234.25. Following the sale, the insider now owns 9,000 shares in the company, valued at $344,250. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Company insiders own 0.37% of the company’s stock.
Several hedge funds have recently modified their holdings of the stock. Andra AP fonden raised its position in shares of Yum China by 4.6% in the third quarter. Andra AP fonden now owns 203,800 shares of the company’s stock worth $7,155,000 after buying an additional 9,000 shares in the last quarter. CenterStar Asset Management LLC purchased a new stake in shares of Yum China in the third quarter worth $202,000. State of New Jersey Common Pension Fund D raised its position in shares of Yum China by 53.7% in the third quarter. State of New Jersey Common Pension Fund D now owns 235,321 shares of the company’s stock worth $8,262,000 after buying an additional 82,251 shares in the last quarter. Sumitomo Mitsui Asset Management Company LTD raised its position in shares of Yum China by 9.2% in the third quarter. Sumitomo Mitsui Asset Management Company LTD now owns 144,134 shares of the company’s stock worth $5,060,000 after buying an additional 12,118 shares in the last quarter. Finally, Canton Hathaway LLC purchased a new stake in shares of Yum China in the third quarter worth $400,000. Institutional investors own 82.63% of the company’s stock.
Yum China Company Profile
Yum China Holdings, Inc owns, operates, and franchises restaurants in China. The company operates in two segments, KFC and Pizza Hut. It operates restaurants under the KFC, Pizza Hut, Taco Bell, East Dawning, and Little Sheep brands, which specialize in chicken, pizza, hot pot cooking, Chinese food, and Mexican-style food categories.
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