# Yum! Brands (YUM.US)

Canonical: https://gigainvestors.com/s/YUM

Analysis as of: 2026-10-16T07:33:19.430Z. Financial observations: FY1997–FY2026.

Listing currency: USD. Reporting currency: USD.

## Verdict

A wonderful business at too high a price

Quality tests for Buy: pass (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $150.83 per share; close as of 2026-10-15.

Estimated value: low $91.30 per share, central $129.66 per share, high $151.97 per share. Buy at or below the central value $129.66 per share. Valuation as of 2026-10-16T07:33:19.430Z; scenarios are not confidence intervals.

Expected annual return: 9.0% at the stated quote. About 9.0% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: pass

- 3 revenue declines in the last 10 years (informational)

- Financial history: 10 years

- Years with declining revenue: 3

- Years with a net loss: 0

- Operating margin variation: 0.16×

Chart: Operating margin; fiscal year observations.

- FY2017: 0.47×

- FY2018: 0.40×

- FY2019: 0.34×

- FY2020: 0.27×

- FY2021: 0.32×

- FY2022: 0.32×

- FY2023: 0.33×

- FY2024: 0.32×

- FY2025: 0.31×

- LTM to Jun 2026: 0.31×

### moat: pass

- ROIC, median of available years: 66.4%

- ROIC, second-lowest year: 57.2%

- Typical minus recent gross margin: 1.3 pp

- Typical gross margin (annual median): 47.5%

- Recent gross margin (lower of latest and 3-year median): 46.2%

- Years with nonpositive capital: 0

- Capital spending / revenue: 4.1%

- ROIC including acquisitions, ten-year median: 42.1%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2016: 57.2%

- FY2017: >100%

- FY2018: >100%

- FY2019: 85.9%

- FY2020: 54.9%

- FY2021: 77.1%

- FY2022: 62.7%

- FY2023: 67.4%

- FY2024: 58.8%

- FY2025: 65.3%

### economics: pass

- Owner earnings / net income, 5-yr: 0.98×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: $7.4B

- Net income, five-year total: $7.5B

- Return on incremental invested capital: 617.1%

- Working capital / revenue, annual change: -0.5 pp

- Working capital / revenue, change between three-year averages: -3.9 pp

- Working capital / revenue, final three-year average: 2.5%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2021: 1.00×

- FY2022: 0.96×

- FY2023: 0.96×

- FY2024: 1.00×

- FY2025: 1.00×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2025 (9 years)

- potential debt-funded buybacks (informational)

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 125.0% vs 65.3%

- Per-share earnings: 3.77 to 5.55 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: -4.5%

- Ordinary dilution, 5-year annual growth: -1.8%

- Market cap gain: $17B

- Cumulative retained earnings: -$1.8B

- Diluted shares, 10-year annual growth: -4.5%

- Diluted shares, 5-year annual growth: -1.8%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2025

- Per-share value growth: 4.9%

- Per-share value change: $1.77

- Per-share value, starting three-year median: $3.77

- Per-share value, ending three-year median: $5.55

- Buybacks concentrated in cheaper years (correlation): 0.59

- Average buyback yield: 4.9%

- Buyback history: 10 years

- Debt-funded buybacks: Yes

- Acquisition spending: $1.3B

- Cumulative net income, 10 years: $14B

- ROIC, first three-year median: >100%

- ROIC, last three-year median: 65.3%

Chart: Earnings per share; fiscal year observations.

- FY2016: $4.11

- FY2017: $3.77

- FY2018: $4.69

- FY2019: $4.13

- FY2020: $2.94

- FY2021: $5.22

- FY2022: $4.57

- FY2023: $5.60

- FY2024: $5.21

- FY2025: $5.55

### accounting: pass

- Sloan accruals: -5.5%

- Receivables to sales index (DSRI): 0.93×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 3.5%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.29×

- Accounting red flags: 0

Chart: Sloan accruals; fiscal year observations.

- FY2016: 7.2%

- FY2017: 5.8%

- FY2018: 8.9%

- FY2019: -0.4%

- FY2020: -6.9%

- FY2021: -2.2%

- FY2022: -1.7%

- FY2023: -0.1%

- FY2024: -3.0%

- FY2025: -5.5%

## Holders

- [Terry Smith](https://gigainvestors.com/FS): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [Thomas Gayner](https://gigainvestors.com/MKL): tracked 13F investor; follow the investor page for holding quarter and amounts.

- [William Von Mueffling](https://gigainvestors.com/cc): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to grow 8.8% a year for ten years · sales +6.2%

Story as of 2026-10-16T09:59:54.844Z; price observation 2026-10-15.

Price needs cash profits to grow 8.8% a year for ten years

- 2025-04-30: Yum Brands First-Quarter Sales Miss Estimates; Sees 'Immaterial' Tariff Impact on Supply Chain ([finance.yahoo.com](https://finance.yahoo.com/news/yum-brands-first-quarter-sales-143740767.html))

- 2025-08-05: Taco Bell parent Yum Brands misses estimates as spending slows, costs rise ([uk.finance.yahoo.com](https://uk.finance.yahoo.com/news/taco-bell-parent-yum-brands-110532802.html))

- 2026-02-15: Yum Brands (YUM) Valuation Check After Earnings Beat Dividend Hike And Rising Digital Sales ([finance.yahoo.com](https://finance.yahoo.com/news/yum-brands-yum-valuation-check-041917196.html))

- 2026-04-29: Yum! Brands surpasses Q1 estimates on solid Taco Bell and KFC sales; stock up ([finance.yahoo.com](https://finance.yahoo.com/markets/stocks/articles/yum-brands-surpasses-q1-estimates-114714297.html))

- 2026-07-21: Yum! Brands faces Taco Bell traffic hit from Taylor Farms lettuce scare ([finance.yahoo.com](https://finance.yahoo.com/video/yum-brands-faces-taco-bell-204500798.html))

### Sales · FY2025–2026

sales +6.2%; source https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm; observed 2026-02-20.

- FY2017: $5.9B 

- FY2018: $5.7B 

- FY2019: $5.6B 

- FY2020: $5.7B 

- FY2021: $6.6B 

- FY2022: $6.8B 

- FY2023: $7.1B 

- FY2024: $7.5B 

- FY2025: $8.2B 

- FY2026: $8.7B 

### Gross margin · FY2025

gross margin 46.2%; source https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm; observed 2026-02-20.

- FY2016: 41.9% 

- FY2017: 45.7% 

- FY2018: 46.7% 

- FY2019: 50.3% 

- FY2020: 47.5% 

- FY2021: 48.1% 

- FY2022: 48.3% 

- FY2023: 49.4% 

- FY2024: 47.5% 

- FY2025: 46.2% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in restaurants; annual sales are USD 8.2 billion.

- Source: https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm (filed 2026-02-20); FY2025: revenue 8214000000; grossProfit 3792000000; margin = grossProfit / revenue.

### Why customers stay

Margins ranged from 46.2% to 49.4% during 2023–25; it earns 66.4% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2023: grossProfit / revenue = 49.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2024: grossProfit / revenue = 47.5%.

- Source: https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm (filed 2026-02-20); FY2025: grossProfit / revenue = 46.2%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); 10-year return on capital observations [[2016,0.572422508090182],[2017,1.2497562674094707],[2018,1.4486035569925257],[2019,0.8588060442625104],[2020,0.5488547953173853],[2021,0.7707774798927614],[2022,0.6271751551827129],[2023,0.6744680099013545],[2024,0.5882312824314307],[2025,0.6532585582358191]]; median 0.6638632840685867. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Can it raise prices

Kept about a 48% gross margin through 2022 cost inflation.

- Source: https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm (filed 2026-02-20); Gross margin observations: [[2021,0.48086269744835963],[2022,0.48333820520315696],[2023,0.49406444318824194]]; range within 2 percentage points.

### Where the cash goes

Spends 10.6% of cash earnings on expansion; earns over 100% on new investment.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2016: growth capex 0; upkeep 422000000; owner earnings 1531000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2017: growth capex 0; upkeep 318000000; owner earnings 1275000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2018: growth capex 0; upkeep 234000000; owner earnings 1445000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2019: growth capex 0; upkeep 196000000; owner earnings 1210000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2020: growth capex 14000000; upkeep 146000000; owner earnings 904000000. Growth capex / owner earnings = 0.015486725663716814.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2021: growth capex 66000000; upkeep 164000000; owner earnings 1575000000. Growth capex / owner earnings = 0.0419047619047619.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2022: growth capex 77198068.28416032; upkeep 201801931.71583968; owner earnings 1269198068.2841604. Growth capex / owner earnings = 0.06082428756649862.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2023: growth capex 72808874.51159525; upkeep 212191125.48840475; owner earnings 1537808874.5115952. Growth capex / owner earnings = 0.047345854038408505.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); FY2024: growth capex 82000000; upkeep 175000000; owner earnings 1486000000. Growth capex / owner earnings = 0.05518169582772544.

- Source: https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm (filed 2026-02-20); FY2025: growth capex 165000000; upkeep 206000000; owner earnings 1559000000. Growth capex / owner earnings = 0.10583707504810776.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); Incremental return on capital 6.171021042884033, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); Dividend observations: [[2016,744000000],[2017,416000000],[2018,462000000],[2019,511000000],[2020,566000000],[2021,592000000],[2022,649000000],[2023,678000000],[2024,752000000],[2025,789000000]]. Zero only counted when supported by a complete cash-flow statement.

- Source: https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm (filed 2026-02-20); FY2025: cash repurchases 552000000 USD.

### Are managers owners

Insiders own 0.2% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); YUM.US SharesStats.PercentInsiders = 0.161 percentage points; cache date 2026-10-16.

### What could break it

Our independent registered public accounting firm is KPMG, LLP, Louisville, Kentucky, Auditor Firm ID: 185.

- Source: https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm (filed 2026-02-20); Principal Accountant Fees and Services. Our independent registered public accounting firm is KPMG, LLP, Louisville, Kentucky, Auditor Firm ID: 185. Information regarding principal accountant fees and services and audit committee pre-approval policies and procedures appearing under the caption “Item 2: Ratification of Independent Auditors” is incorporated by reference from the Company’s definitive proxy statement which will be filed with the Securities and Exchange Commission no later than 120

### What the price says

The price assumes cash profits grow 8.8% yearly over ten years; actual growth was 14.4%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-02-20); Ten-year compound average after fade. Initial solved rate 0.14818850046136828. Price 150.83; FX 1; discount 0.1; same compounder ten-year fade to terminal 0.03. FY2015 owner earnings/share 1.4424379232505644 → FY2025 5.548042704626335. Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2016-10: $86.28 per share

- 2016-11: $63.39 per share

- 2016-12: $63.33 per share

- 2017-01: $65.53 per share

- 2017-02: $65.32 per share

- 2017-03: $63.90 per share

- 2017-04: $65.75 per share

- 2017-05: $72.64 per share

- 2017-06: $73.76 per share

- 2017-07: $75.48 per share

- 2017-08: $76.82 per share

- 2017-09: $73.61 per share

- 2017-10: $74.45 per share

- 2017-11: $83.47 per share

- 2017-12: $81.61 per share

- 2018-01: $84.59 per share

- 2018-02: $81.38 per share

- 2018-03: $85.13 per share

- 2018-04: $87.10 per share

- 2018-05: $81.33 per share

- 2018-06: $78.22 per share

- 2018-07: $79.29 per share

- 2018-08: $86.89 per share

- 2018-09: $90.91 per share

- 2018-10: $90.41 per share

- 2018-11: $92.22 per share

- 2018-12: $91.92 per share

- 2019-01: $93.98 per share

- 2019-02: $94.50 per share

- 2019-03: $99.81 per share

- 2019-04: $104.39 per share

- 2019-05: $102.35 per share

- 2019-06: $110.67 per share

- 2019-07: $112.52 per share

- 2019-08: $116.78 per share

- 2019-09: $113.43 per share

- 2019-10: $101.71 per share

- 2019-11: $100.67 per share

- 2019-12: $100.73 per share

- 2020-01: $105.77 per share

- 2020-02: $89.25 per share

- 2020-03: $68.53 per share

- 2020-04: $86.43 per share

- 2020-05: $89.73 per share

- 2020-06: $86.91 per share

- 2020-07: $91.05 per share

- 2020-08: $95.85 per share

- 2020-09: $91.30 per share

- 2020-10: $93.33 per share

- 2020-11: $105.80 per share

- 2020-12: $108.56 per share

- 2021-01: $101.49 per share

- 2021-02: $103.53 per share

- 2021-03: $108.18 per share

- 2021-04: $119.52 per share

- 2021-05: $119.97 per share

- 2021-06: $115.03 per share

- 2021-07: $131.39 per share

- 2021-08: $131.03 per share

- 2021-09: $122.31 per share

- 2021-10: $124.94 per share

- 2021-11: $122.84 per share

- 2021-12: $138.86 per share

- 2022-01: $125.17 per share

- 2022-02: $122.58 per share

- 2022-03: $118.53 per share

- 2022-04: $117.01 per share

- 2022-05: $121.47 per share

- 2022-06: $113.51 per share

- 2022-07: $122.54 per share

- 2022-08: $111.24 per share

- 2022-09: $106.34 per share

- 2022-10: $118.25 per share

- 2022-11: $128.66 per share

- 2022-12: $128.08 per share

- 2023-01: $130.51 per share

- 2023-02: $127.16 per share

- 2023-03: $132.08 per share

- 2023-04: $140.58 per share

- 2023-05: $128.69 per share

- 2023-06: $138.55 per share

- 2023-07: $137.67 per share

- 2023-08: $129.38 per share

- 2023-09: $124.94 per share

- 2023-10: $120.86 per share

- 2023-11: $125.55 per share

- 2023-12: $130.66 per share

- 2024-01: $129.49 per share

- 2024-02: $138.42 per share

- 2024-03: $138.65 per share

- 2024-04: $141.25 per share

- 2024-05: $137.43 per share

- 2024-06: $132.46 per share

- 2024-07: $132.83 per share

- 2024-08: $134.92 per share

- 2024-09: $139.71 per share

- 2024-10: $131.16 per share

- 2024-11: $138.94 per share

- 2024-12: $134.16 per share

- 2025-01: $130.50 per share

- 2025-02: $156.37 per share

- 2025-03: $157.36 per share

- 2025-04: $150.44 per share

- 2025-05: $143.94 per share

- 2025-06: $148.18 per share

- 2025-07: $144.15 per share

- 2025-08: $146.97 per share

- 2025-09: $152.00 per share

- 2025-10: $138.21 per share

- 2025-11: $153.21 per share

- 2025-12: $151.28 per share

- 2026-01: $155.50 per share

- 2026-02: $168.16 per share

- 2026-03: $155.48 per share

- 2026-04: $159.65 per share

- 2026-05: $147.95 per share

- 2026-06: $159.86 per share

- 2026-07: $153.28 per share

- 2026-08: $153.31 per share

- 2026-09: $136.34 per share

- 2026-10: $147.06 per share

## Annual estimated value (USD per share)

- FY2016: low $18.73 per share, central $21.12 per share, high $24.29 per share

- FY2017: low $21.98 per share, central $24.46 per share, high $27.77 per share

- FY2018: low $41.53 per share, central $47.18 per share, high $54.71 per share

- FY2019: low $43.97 per share, central $49.82 per share, high $57.60 per share

- FY2020: low $45.66 per share, central $51.68 per share, high $59.69 per share

- FY2021: low $53.76 per share, central $62.11 per share, high $72.01 per share

- FY2022: low $56.78 per share, central $64.79 per share, high $75.13 per share

- FY2023: low $78.80 per share, central $113.73 per share, high $133.42 per share

- FY2024: low $77.66 per share, central $112.40 per share, high $131.77 per share

- FY2025: low $83.77 per share, central $118.86 per share, high $139.25 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

Prior published observations retained from 2026-10-15T06:39:04.915Z where newer inputs omit a numeric field or fiscal period.

## Sources

[Original 10-K filing](https://www.sec.gov/Archives/edgar/data/1041061/000104106126000084/yum-20251231.htm); period 2025-12-31, filed 2026-02-20.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.