Zacks lowered shares of Yum! Brands (NYSE:YUM) from a neutral rating to an underperform rating in a research report released on Thursday morning, ARN reports. Zacks currently has $59.00 price objective on the stock.
Zacks’ analyst wrote, “We are downgrading our recommendation on Yum from Neutral to Underperform based on the dim outlook for Yum!’s China division, which in turn, compelled the company to slash its 2013 outlook. China has been a crucial player in Yum! Brands’ growth story. The negative publicity regarding the quality of chicken supplied to Yum!’s KFC in China in Dec 2012 and the outbreak of avian flu in mid-April has been taking a toll on the company’s top line. Yum! Brands’ third-quarter 2013 adjusted earnings per share and revenues fell sharply year over year due to the lackluster performance of the China division. In fact, the better-positioned U.S. and YRI divisions did not perform well in the third quarter. Both earnings and revenues missed the Zacks Consensus Estimate due to slower-than-expected recovery in KFC China. Owing to lower sales expectation in China and higher tax rate, Yum! expects its 2013 earnings per share to decline in the high-single to low-double digit range compared to its prior estimate of mid-single digit decline.”
Zacks has also updated their ratings on a number of other consumer discretionary stocks in the last week. The firm downgraded shares of SHFL Entertainment Inc. from a neutral rating to an underperform rating. Their analysts now have a $22.00 price target on that stock. Also, Zacks reiterated its neutral rating on shares of Panera Bread Co.. They have a $161.00 price target on that stock. Finally, Zacks reiterated its neutral rating on shares of Cheesecake Factory Inc.. They have a $45.00 price target on that stock.
Yum! Brands (NYSE:YUM) opened at 66.57 on Thursday. Yum! Brands has a 52 week low of $59.68 and a 52 week high of $75.13. The stock has a 50-day moving average of $72.40 and a 200-day moving average of $70.01. The company has a market cap of $29.646 billion and a P/E ratio of 27.89.
Yum! Brands (NYSE:YUM) last posted its quarterly earnings results on Wednesday, October 9th. The company reported $0.85 EPS for the quarter, missing the Thomson Reuters consensus estimate of $0.93 by $0.08. The company had revenue of $3.47 billion for the quarter, compared to the consensus estimate of $3.53 billion. During the same quarter in the prior year, the company posted $0.99 earnings per share. The company’s quarterly revenue was down 2.9% on a year-over-year basis. Analysts expect that Yum! Brands will post $2.91 EPS for the current fiscal year.
The company also recently announced a quarterly dividend, which is scheduled for Friday, November 1st. Shareholders of record on Friday, October 11th will be paid a dividend of $0.37 per share. This represents a $1.48 annualized dividend and a dividend yield of 2.22%. The ex-dividend date is Wednesday, October 9th. This is a positive change from Yum! Brands’s previous quarterly dividend of $0.34.
A number of other firms have also recently commented on YUM. Analysts at Janney Montgomery Scott downgraded shares of Yum! Brands from a buy rating to a neutral rating in a research note to investors on Wednesday, October 23rd. They now have a $65.00 price target on the stock. Separately, analysts at Citigroup Inc. reiterated a neutral rating on shares of Yum! Brands in a research note to investors on Monday, October 14th. They now have a $72.00 price target on the stock, down previously from $75.00. Finally, analysts at Susquehanna cut their price target on shares of Yum! Brands from $73.00 to $69.00 in a research note to investors on Thursday, October 10th. They now have a neutral rating on the stock. One research analyst has rated the stock with a sell rating, seventeen have assigned a hold rating and ten have assigned a buy rating to the company. Yum! Brands currently has an average rating of Hold and a consensus price target of $71.20.
Yum! Brands, Inc (NYSE:YUM) is a quick service restaurant company based on number of system units, with approximately 37,000 units in more than 120 countries and territories.
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