YUM changes
Pick any two versions below to diff them.
- Price
- $138.63 → $137.73(−0.6%)
- Next earnings
- Nov 2, 2026 → Oct 30, 2026
- Next earnings is estimate
- No → Yes
- About
- Yum! Brands owns KFC, Taco Bell, and Habit Burger & Grill. removed: It added: After it sold Pizza Hut in 2026, it has more than removed: 64,000 added: 44,000 restaurants in removed: about 155 added: 151 countries. Franchisees run removed: about 97% added: almost all of them. Yum makes most of its money from franchise fees and royalties, which are a percentage of each restaurant's sales. So franchisees pay most of the cost to build and run the stores. KFC is the biggest removed: brand by store count, added: brand, with about 34,700 restaurants, removed: mostly added: and about 90% of them are outside the US. removed: Taco Bell is added: KFC also makes the most removed: profitable brand, and most added: profit: $1.5 billion of removed: its sales come from added: division operating profit in 2025, against $1.1 billion for Taco Bell. Most Taco Bell restaurants are in the US. Yum also builds its own restaurant software, called Byte by Yum!, for ordering, kitchens, and delivery. Digital orders were 61% of sales in Q2 removed: 2026. Yum sold added: 2026, not counting Pizza removed: Hut in 2026: Pizza Hut in Mainland China went to Yum China, and the rest of Pizza Hut went to the private equity firm LongRange Capital. added: Hut.
- Thesis
- Yum Brands trades at a discount because a added: large Cyclospora removed: health scare added: outbreak at Taco Bell in July 2026 raised doubt about how fast the brand recovers. added: It was the largest US Cyclospora outbreak on record, with 12,883 cases. Taco Bell makes added: about 43% of Yum's division profit without Pizza Hut, and most of Yum's added: US profit. removed: Third-party foot-traffic data still showed added: Yum said Taco Bell US removed: visits well below last year's level added: same-store sales fell 2% in removed: mid-September 2026, nearly two months added: the weeks after the removed: outbreak. So the market wants official same-store sales to prove added: outbreak, and it expects a removed: full recovery, not just added: lower Taco Bell US restaurant margin in Q3. Higher interest rates add a removed: slowing decline. Investors also worry added: second pressure. The 10-year Treasury yield rose from about removed: KFC, whose same-store sales growth slowed to 2% added: 4% in removed: Q2 added: February 2026 removed: as added: to above 5% in September 2026, and this lowers the price investors pay for steady franchise royalties. Yum removed: stopped reporting KFC US sales on their own. Yum also carries about removed: $11.5 added: $12.3 billion of below-investment-grade removed: debt, which limits flexibility if added: debt. KFC is the larger profit engine and was not affected by the outbreak, but its same-store sales removed: stay soft. added: grew only 2% in Q2 2026. For the gap to close, Taco removed: Bell's added: Bell US same-store sales removed: need to added: must turn positive again removed: in a quarter Yum reports after the outbreak. added: by Q1 2027. KFC removed: needs to show its international unit growth removed: can offset a slower added: outside the US removed: business. Selling added: must stay at 5% or more. Yum must spend most of the about $2.3 billion from the Pizza removed: Hut, completed in mid-2026, already removed Yum's weakest brand added: Hut sale on buybacks, and removed: freed added: refinance about removed: $2.3 added: $1.6 billion removed: for added: of debt removed: paydown and added: that matures in 2027 at a removed: new $4 billion buyback. added: reasonable cost. The removed: next scheduled added: first test is Yum's Q3 2026 removed: earnings report, expected removed: around added: in early November removed: 2, 2026, removed: which should show whether Taco Bell traffic and removed: same-store sales have recovered. added: above all what management says about October sales. If removed: the recovery holds up in added: Taco Bell recovers on that removed: report and KFC's international store growth continues, added: path, the discount can close over the next two to removed: three added: four quarters. The main risk is that customer trust removed: takes longer to recover added: returns more slowly than the removed: health scare itself. Lower-income consumers may also keep pulling added: outbreak ended, while low-income customers cut back added: and competitors fight on removed: fast food, so Taco Bell's recovery could take longer than the market expects. added: price.
- Risks
- Taco Bell makes removed: most added: about 43% of Yum's removed: profit. added: division profit without Pizza Hut. The July 2026 Cyclospora outbreak pushed its US same-store sales removed: down 2% added: down, and Yum expects a lower margin at its own US Taco Bell restaurants in removed: the weeks after. added: Q3. If customers stay away longer than expected, Yum's profit growth slows. removed: Third-party foot-traffic data showed Taco Bell US same-store visits still added: Several proposed class-action lawsuits also add legal costs. Higher interest rates lower the price investors pay for steady franchise royalties. The 10-year Treasury yield rose from about removed: 12% below last year through added: 4% in February 2026 to above 5% in September removed: 11, 2026, nearly two months after the July Cyclospora outbreak. This suggests the sales recovery added: 2026. The direct cost is removed: slower than management described in late July. Yum added: small, because about 96% of Yum's term debt has added: a fixed rate. Yum had about removed: $11.5 added: $12.3 billion of debt removed: and added: at June 30, 2026, with a below-investment-grade credit rating (BB+ at S&P, Ba2 at Moody's). It targets added: net debt of about 4 times removed: EBITDA while it spends $4 added: EBITDA. About $1.6 billion removed: on buybacks. This leaves less room if sales drop. KFC same-store sales grew only 2% added: matures in removed: Q2 2026, added: 2027 at rates of 1.95% and added: 4.75%, so refinancing will cost more. If Yum removed: no longer reports KFC US sales on their own. KFC's growth depends more and more on new stores outside the US. added: does not refinance its June 2027 notes in time, its bank loans also come due early. Lower-income customers are cutting back on fast food, and removed: weight-loss added: competitors such as McDonald's and Burger King push low-price deals. Weight-loss drugs such as GLP-1s can added: also reduce how much people eat out. removed: Both added: These trends can slow traffic added: and lower prices at removed: Yum's brands. added: Taco Bell. KFC same-store sales grew only 2% in Q2 2026, and KFC US system sales fell 2%. In 2026, Yum added: stopped reporting KFC US and international same-store sales separately. KFC's growth depends more and more on new stores outside the US, and China is about 26% of KFC system sales. Yum has a new CEO, CFO, and Taco Bell CEO since October 2025, and its COO leaves on November 1, 2026. It still provides its Byte by Yum! software added: and other services to Pizza Hut after the sale, and part of the price depends on an earn-out through 2030. removed: The separation adds some short-term complexity.
- Recent events
- Sep removed: 15, added: 17, 2026: Third-party foot-traffic data (Placer.ai) showed Taco Bell US removed: same-store visits removed: running about added: per restaurant down 12.2% removed: below last added: from a year added: earlier, on average, from July 6 removed: through added: to September 11, removed: 2026, nearly two months after added: 2026. This average includes the added: worst days of the outbreak, down about 31% on July 17. It does not show the level in mid-September. Sep 11, 2026: The CDC declared the Cyclospora added: outbreak over. It counted 12,883 illnesses in 21 states, at least 570 hospitalizations, and 2 deaths. The source was iceberg lettuce from Taylor Farms de Mexico. This was the largest US Cyclospora outbreak on record. Sep 9, 2026: At an investor conference, Yum's CFO said Taco Bell's recovery was "tracking as planned," with several days of positive same-store sales. He said growth among households earning under $100,000 was slightly slower. Yum did not change its guidance. Sep 1, 2026: Yum completed the sale of Pizza Hut outside Mainland China to LongRange Capital, for $1.488 billion in cash plus up to $75 million more by 2030, based on future results. Yum now has more than 44,000 restaurants in 151 countries. Aug 11, 2026: Taco Bell, Taylor Farms, and a franchisee were named in several proposed class-action lawsuits over the Cyclospora outbreak. Aug 7, 2026: Yum China completed its purchase of the Pizza Hut brand in Mainland China from Yum! removed: Brands. added: Brands, for $1.2 billion. Jul 30, 2026: Yum reported Q2 2026 results. Revenue was $2.17 billion, up 12% from last year. Adjusted EPS was $1.62. Excluding Pizza Hut, system sales grew 7% and core operating profit grew 8%. Taco Bell US same-store sales grew 7%, and KFC same-store sales grew 2%. Jul 30, 2026: Management said Taco Bell US same-store sales were down 2% in Q3 through July 27, after the Cyclospora outbreak, but that the decline was getting smaller. It expects added: the margin at Taco Bell's removed: Q3 restaurant margin added: own US restaurants to be 19% to removed: 21%. added: 21% in Q3, against 26.2% in Q2. Jul 17, 2026: A multistate Cyclospora outbreak, traced to lettuce from a supplier, was linked to Taco Bell restaurants. Taco Bell traffic dropped, and YUM shares fell about removed: 9% in mid-July. added: 8.5% from July 13 to July 17. Jun 16, 2026: Yum agreed to sell Pizza Hut for $2.7 billion in total: Pizza Hut in Mainland China to Yum China for $1.2 billion, and the rest of Pizza Hut to LongRange Capital, plus an earn-out of up to $75 million. The board also approved a new $4 billion share removed: buyback. added: buyback that runs until June 30, 2028. Jun 2, 2026: Yum said its Chief Operating Officer, Tracy Skeans, will step down on November 1, 2026. Apr 29, 2026: Yum reported Q1 2026 results. Revenue was $2.06 billion and adjusted EPS was $1.50, up 15% from last year. Taco Bell same-store sales grew 8%. Nov 4, 2025: Yum started a review of strategic options for Pizza Hut, after Pizza Hut same-store sales fell for most of 2025. Oct 1, 2025: Chris Turner, formerly Yum's CFO and Chief Franchise Officer, became CEO. He replaced David Gibbs, who retired.