Yum! Brands' Shares Leap 6.1% on Stellar Q2 Results
Shares of fast-food restaurant firm Yum! Brands, Inc. (YUM) closed 6.1% higher on Thursday after the company reported strong second-quarter 2021 results on the back of same-store sales growth across Read More... The post Yum! Brands' Shares Leap 6.1% on Stellar Q2 Results appeared first on TipRanks Financial Blog.
Shares of fast-food restaurant firm Yum! Brands, Inc. (YUM) closed 6.1% higher on Thursday after the company reported strong second-quarter 2021 results on the back of same-store sales growth across all business divisions.
Yum! Brands operates 43,617 restaurants across 135 countries through its brands WingStreet, The Habit Burger Grill, Taco Bell, Pizza Hut and KFC. (See Yum stock chart on TipRanks)
Adjusted earnings per share (EPS) increased 41% year-over-year to $1.16, beating the Street’s estimate of $0.95. Total revenues grew 34% to $1.6 billion, surpassing analysts’ expectations of $1.48 billion.
KFC division’s sales surged 67% year-over-year to $682 million; sales of Pizza Hut division climbed 6% to $249 million; and Taco Bell division’s sales rose 19% to $532 million.
The CEO of Yum! Brands, David Gibbs, said, “On the basis of these strong results, we’re reinstating our long-term growth algorithm and revising the unit growth component of this algorithm from 4% unit growth to between 4% and 5% unit growth.”
Following the announcement of the second-quarter results, Cowen & Co. analyst Andrew Charles reiterated a Hold rating on the stock but raised the price target to $134 from $117 (2.8% upside potential).
The analyst said, “We are pleased with Yum's second-quarter performance and the confidence to reinstate long-term guidance + raise long-term net restaurant development to 4%-5% from 4%. We raise 2021-23 expected EPS by 7%.”
Overall, the stock has a Moderate Buy consensus based on 6 Buys, 5 Holds and 1 Sell. The average Yum! Brands price target of $127.90 implies nearly 2% downside potential. Shares of the company have gained 42.2% over the past year.
According to TipRanks’ Smart Score rating system, Yum scores a 9 out of 10, suggesting that the stock is likely to outperform market averages.
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