Yum! Brands Tipped For 16% Upside As Analyst Points To Strong Unit Growth, AI Investment
The analyst asserted that the company demonstrates a best-in-class unit growth trajectory, which stands out compared to most peers who are either below or at the low end of their stated growth algorithms.
Furthermore, the analyst highlighted YUM's high franchise mix, at 98% of units, which she expressed builds relative resilience in the business.The analyst also pointed to improved digital integration across YUM's various brands and at the enterprise level, specifically mentioning Byte! by YUM. The analyst said these digital advancements are expected to improve operational efficiency and drive top-line acceleration.
Finally, the analyst emphasized Taco Bell U.S.'s sustained value leadership and the significant opportunity to accelerate international growth for the brand.
Based on these considerations, the analyst indicated a 16% upside potential to the 12-month price forecast of $167, which she noted compares favorably to the 9% average upside for the rest of their coverage.
The analyst revised the EBITDA estimates to $2.90 billion (from $2.91 billion) for FY25, $3.16 billion (from $3.16 billion) for FY26 and $3.43 billion (from $3.44 billion earlier).
In April, Yum! Brands reported first-quarter revenue of $1.79 billion, missing the analyst consensus estimate of $1.8 billion. Adjusted EPS of $1.30 beat the analyst consensus of $1.29.
The analyst highlighted several trends in the sector, including diverging brand performance, with casual dining showing more resilience year-to-date than fast food.
Cho added that investors are increasingly favoring self-help narratives driven by unique traffic/market share catalysts or margin opportunities based on operational efficiency.
While commodity/labor costs are relatively stable, tariffs remain a key swing factor for the second half, and companies are reluctant to raise prices given soft consumer sentiment, she said.
The analyst sees elevated risk to global restaurant development plans in FY26/27, potentially pushing unit growth below the stated long-term algorithms.
Price Action: YUM shares are trading higher by 0.64% to $144.89 at last check Wednesday.
Read Next:Image via Shutterstock
Date
Firm
Action
From
To
Feb 2022
Cowen & Co.
Upgrades
Market Perform
Outperform
Dec 2021
Barclays
Maintains
Equal-Weight
Dec 2021
Atlantic Equities
Upgrades
Neutral
Overweight
View More Analyst Ratings for YUM
View the Latest Analyst Ratings
UNLOCKED: 5 NEW TRADES EVERY WEEK. Click now to get top trade ideas daily, plus unlimited access to cutting-edge tools and strategies to gain an edge in the markets.
Get the latest stock analysis from Benzinga?
YUM BRANDS (YUM): Free Stock Analysis Report
This article Yum! Brands Tipped For 16% Upside As Analyst Points To Strong Unit Growth, AI Investment originally appeared on Benzinga.com
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
8 minutes ago
- Yahoo
Why Carter's (CRI) Stock Is Nosediving
What Happened? Shares of children's apparel manufacturer Carter's (NYSE:CRI) fell 21.4% in the afternoon session after the company reported disappointing second-quarter earnings, missed profit estimates, and suspended its full-year financial guidance. The children's apparel company posted adjusted earnings of $0.17 per share, falling significantly short of analyst expectations of around $0.37 and marking a steep drop from the $0.76 per share reported a year earlier. While revenue increased slightly by 3.7% to $585.3 million, this was overshadowed by a severe decline in profitability. The company's operating income fell by nearly 90%. Management attributed the poor results to investments in pricing, costs from new stores, and the impact of higher tariffs. The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Carter's? Access our full analysis report here, it's free. What Is The Market Telling Us Carter's shares are quite volatile and have had 17 moves greater than 5% over the last year. But moves this big are rare even for Carter's and indicate this news significantly impacted the market's perception of the business. The biggest move we wrote about over the last year was 5 months ago when the stock dropped 18.1% on the news that the company reported disappointing Q4 2024 results. Its full-year EPS guidance missed significantly and its EPS guidance for next quarter also fell short of Wall Street's estimates. Revenue was flat, as growth in U.S. Wholesale was offset by declines in U.S. Retail and International segments. Adjusted EBITDA took a hit, with margins shrinking due to higher freight costs and increased promotional spending, which hurt profitability. Management pointed to macroeconomic pressures, high interest rates, and planned pricing investments as ongoing challenges. On the bright side, the company beat analysts' same-store sales expectations, which helped deliver an EPS beat. Still, the weak guidance is weighing on the stock. Carter's is down 52.2% since the beginning of the year, and at $25.72 per share, it is trading 63.8% below its 52-week high of $71.04 from September 2024. Investors who bought $1,000 worth of Carter's shares 5 years ago would now be looking at an investment worth $292.34. Unless you've been living under a rock, it should be obvious by now that generative AI is going to have a huge impact on how large corporations do business. While Nvidia and AMD are trading close to all-time highs, we prefer a lesser-known (but still profitable) semiconductor stock benefiting from the rise of AI. Click here to access our free report on our favorite semiconductor growth story. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Wire
10 minutes ago
- Business Wire
DEADLINE ALERT: Faruqi & Faruqi, LLP Investigates Claims on Behalf of Investors of Fiserv
NEW YORK--(BUSINESS WIRE)-- Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential claims against Fiserv, Inc. ('Fiserv' or the 'Company') (NYSE: FI) and reminds investors of the September 22, 2025 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company. As detailed below, the complaint alleges that the Company and its executives violated federal securities laws by making false and/or misleading statements Share Faruqi & Faruqi is a leading national securities law firm with offices in New York, Pennsylvania, California and Georgia. The firm has recovered hundreds of millions of dollars for investors since its founding in 1995. See As detailed below, the complaint alleges that the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (a) due to cost issues and other problems with its older Payeezy platform, Fiserv forced Payeezy merchants to migrate to its Clover platform; (b) Clover's revenue growth and gross payment volume ('GPV'), the total monetary value of transactions processed through Clover, were temporarily and unsustainably boosted by these forced conversions, which concealed a slowdown in new merchant business; (c) shortly after these conversions, a significant portion of former Payeezy merchants switched to competing solutions due to Clover's high pricing, significant down time, and systematic compatibility issues; (d) as a result of these merchant losses, Clover's GPV growth was significantly slowing, and its revenue growth was unsustainable; and (e) based on the foregoing, Fiserv's positive Class Period statements about Clover's growth strategies, competition, attrition, GPV growth, and business prospects were materially false and misleading. The market began to learn the truth about Defendants' fraud on April 24, 2025. On that date, Fiserv shocked investors by reporting Clover GPV growth of only 8 percent for the first quarter of 2025, a material stepdown from 2024 GPV rates of between 14 and 17 percent. The Company attributed this slowing growth to lower 2025 transaction volumes from Payeezy merchants who had converted to Clover. On this news, Fiserv stock dropped 18.5 percent, closing at $176.90 per share on April 24, 2025. Then, on May 15, 2025, Fiserv disappointed investors by disclosing that GPV growth deceleration would continue throughout 2025. On this news, Fiserv stock dropped 16.2 percent, closing at $159.13 per share on May 15, 2025. Finally, on July 23, 2025, Fiserv lowered the top end of its full-year organic growth guidance range and confirmed that its quarterly organic revenue in the Merchant segment had decelerated to 9 percent year-over-year from 11 percent in the previous quarter. On this news, Fiserv stock dropped 13.9 percent, closing at $143.00 per share on July 23, 2025. The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not. Faruqi & Faruqi, LLP also encourages anyone with information regarding Fiserv's conduct to contact the firm, including whistleblowers, former employees, shareholders and others. To learn more about the Fiserv, Inc. class action, go to or call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310). Follow us for updates on LinkedIn, on X, or on Facebook. Attorney Advertising. The law firm responsible for this advertisement is Faruqi & Faruqi, LLP ( Prior results do not guarantee or predict a similar outcome with respect to any future matter. We welcome the opportunity to discuss your particular case. All communications will be treated in a confidential manner.
Yahoo
14 minutes ago
- Yahoo
GE Aerospace (GE) Price Target Hiked at Citi on Solid Guidance
GE Aerospace (NYSE:GE) is one of the best 52-week high stocks to buy now. On July 18, Citi raised its price target of the stock to $309 from $296 while maintaining a Buy rating. The adjustment follows the company's better-than-expected second-quarter results. A shot of a prototype aircraft taking to the skies, the symbol of the companies innovation in aerospace & defense. The global aerospace leader also increased its full-year guidance, buoyed by positive order trends and a less bearish macroeconomic outlook. GE Aerospace also revised its 2028 targets, affirming a compound annual growth rate of more than 10% in revenue, EBIT, and free cash flow. According to Citi, GE Aerospace is a buy due to the healthy mid-single-digit growth in flight hours. In addition, the research firm expects the company to benefit from improvements in the supply chain and productivity. GE Aerospace (NYSE:GE) is a global leader in aerospace, focusing on inventing and developing aircraft engines, systems, and services. It is also involved in both commercial and military aviation, with a vast installed base of engines. While we acknowledge the potential of GE as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: 10 Best Biotech Stocks to Buy According to Billionaire Steve Cohen and 11 Growth Stocks That Could Double by 2027. Disclosure: None. This article is originally published at Insider Monkey. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
