Yum Brands Stock Owner Insight

by Rob Otman

Yum Brands stock (NYSE: YUM) had a calm day in the market on Tuesday November 14. Shares moved -0.05% and closed the day at $79.4. They're now trading 2.76% below their 52-week high of $81.65.

With today's drop, Yum Brands now has a market cap of $27 billion. That makes it a large cap company.

The business operates in the retail-restaurants industry and employs 90,000 people. Its shares trade primarily on the New York stock exchange.

Yum Brands has 336.99 million shares outstanding and 1.06 million traded hands for the day. That's below the average 30-day volume of 1.91 million shares.

The amount of Yum Brands stock is also dropping as the company buys back its own shares. In the last 12 months, it repurchased $3,017 million worth.

Over the last five years, Yum Brands's revenue is down by -49.58%. You can see this drop in annual revenue chart below...

In the last year alone, Yum Brands's revenue has dropped by -1.15%. That's not a good sign for Yum Brands stock owners.

It's good to invest in companies that grow their sales. A growing top line is a sign of a healthy business.

For now, Yum Brands will continue to pull in revenue. So let's take a closer look at the company's total financial health.

One way to do that is by looking at its balance sheet... Yum Brands's cash comes in at $704 million and the company's debt is $10 billion...

Yum Brands's cash pile is smaller than its total debt. This is common for many companies. They can issue debt at a lower cost to take on new projects... but the debt to cash level is a bit high and is a concern for the business.

What is Yum Brands Stock Worth?

Let's look at a few key ratios to determine the value of Yum Brands stock…

Price-to-Earnings (P/E): This ratio comes in at 28.19 for Yum Brands. That's a reasonable level. A high P/E ratio shows that investors are already expecting high earnings growth.

Profit Margin (PM): The profit margin for the company sits at 18%. That’s high and shows a good level of profitability. Although, this metric will jump around over time due to earnings adjustments and calculations.

These two metrics are a good place to start but stock analysis should go much further.

Stay tuned for more.

Please note that there are many other factors you should consider before investing. That's why The Oxford Club offers more than a dozen newsletters and trading advisories all aimed at helping investors grow and maintain their wealth.

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