Yum! Brands, Inc. YUM
Yum! Brands stays a hold at $152.03 as Q2 2026 revenue grew 12.27% YoY to $2.17B and the company beat consensus EPS estimates ($1.62 actual vs. $1.58 estimated), but persistent margin compression — FY2025 gross margin of 46.17% and operating margin of 30.80% are both down from FY2023's 49.41% and 32.76% — and an ongoing Pomerantz law firm investigation create uncertainty.
The stock trades at a P/E of 18.99x roughly in line with the peer median of 18.52x, but EV/EBITDA of 18.57x carries a 58.06% premium to the peer median of 11.75x, difficult to justify given $11.91B in total debt against negative stockholders' equity of $7.33B and a smart money score near zero at 0.006 as of the quarter ended 2026-06-30.
What could go wrong
- Legal investigation. Pomerantz LLP is investigating claims on behalf of YUM investors (announced Aug 25–27, 2026); an adverse outcome or expanded regulatory scrutiny could trigger selling pressure and reputational damage.
- Margin erosion. Gross margin has compressed from 49.41% in FY2023 to 46.17% in FY2025, and operating margin from 32.76% to 30.80% over the same period; continued cost inflation could further pressure profitability.
- Leveraged balance sheet. Total debt of $11.91B against negative stockholders' equity of $7.33B as of FY2025 limits financial flexibility and amplifies downside risk in a downturn.
- Weak institutional conviction. Smart money score of 0.006 as of Q2 2026 with net insider selling of $2.95M over 24 months suggests limited enthusiasm from sophisticated investors.
What would change my mind
Where this comes from: quarterly_results Q2 2026 (period ended 2026-06-30) · earnings_surprises (period_end 2026-07-30) · derived_metrics FY2025 · derived_metrics FY2023. Orin's read on YUM; not advice.
Twelve months actual closes to 2026-09-23 · actual filings
50-day average 200-day average · volume below
On file
All YUM filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Jpmorgan Chase & | $3.2B | 0.2% of fund |
| Vanguard Capital Management | $2.9B | 0.1% of fund |
| Vanguard Portfolio Management | $2.2B | 0.1% of fund |
| State Street | $2.1B | 0.1% of fund |
| Geode Capital Management | $1.3B | 0.1% of fund |
| Norges Bank | $802.8M | 0.1% of fund |
100 filers · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 365 Form 4 filings, net −$3.0M. Of the 50 on hand, 0 were open-market purchases and 23 sales— the rest are grants, option exercises and tax withholding.
Ask Orin about YUM
Orin answers questions about YUM from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →Where it trades
| Metric | Now | Own median | Sector |
|---|---|---|---|
| P/E | 17.6× | 26.2× | 79.6× |
| EV/EBITDA | 17.5× | 19.4× | — |
| P/S | 4.45× | 5.19× | — |
Its P/E sits below all 5 of the last 5 years (−5.15σ from its own mean).
10.0%
free-cash-flow growth every year for 10 years, discounted at 10%, is what today’s price implies — starting from $1.6B of trailing free cash flow. It is an assumption the market is making, not a forecast Orin is making.
What Wall Street published
$172
$162 – $185 · +23% against today's price
- 21 buy or overweight
- 27 hold
- 3 underweight or sell
The analysts’ consensus and their own ratings, not Orin’s. A target is a twelve-month opinion published by the firm that wrote it.
Against the companies it is compared to
| Company | Market cap | P/E | EV/EBITDA | Gross | Net | ROE |
|---|---|---|---|---|---|---|
| YUMYum! Brands, Inc. | $39B | 17.6× | 17.5× | 45.8% | 25.4% | -30% |
| CCLCarnival Corporation & plc | $30B | 9.4× | 7.5× | 34.4% | 11.2% | 24% |
| CMGChipotle Mexican Grill, Inc. | $42B | 30.0× | 20.7× | 24.1% | 11.4% | 53% |
| CPRTCopart, Inc. | $27B | 18.5× | 12.1× | 44.7% | 31.8% | 16% |
| DHID.R. Horton, Inc. | $39B | 13.3× | 10.8× | 22.6% | 9.2% | 13% |
| EBAYeBay Inc. | $48B | 22.1× | 17.6× | 72.5% | 18.5% | 48% |
| LVSLas Vegas Sands Corp. | $25B | 15.2× | 8.1× | 50.9% | 12.8% | 142% |
The median is of the 6 peers listed above and nothing else — check it against the column. This company trades 4.3% above it. The peer set is the vendor’s, so a company can appear here that a person would not have chosen.
What it has traded at
What its sector has traded at
Two scales, drawn separately on purpose: a sector median and one company’s multiple are not the same number and putting them on one axis invites a comparison neither series supports.
Discounted cash flow
| Model | Fair value | Against | Computed |
|---|---|---|---|
| Standard DCF | $268 | $152.47 · +76% | 2026-06-10 |
| Levered DCF | $201 | $152.47 · +32% | 2026-06-10 |
The vendor’s intrinsic-value models. Treat them as a low-growth anchor — for a fast grower the market routinely pays well above a DCF. These were computed against the price in the “against” column, not today’s.
Every estimate on one scale
The vertical rule is the current price. Ranges and point estimates are the backend’s, published as they were calculated; an arrow means the estimate sits beyond this scale, and its number is on the right.