NYSE:YUMC

Stock Analysis Report

Executive Summary

Yum China Holdings, Inc. owns, operates, and franchises restaurants in China.

Snowflake

Fundamentals

Flawless balance sheet with solid track record.


Similar Companies

Share Price & News

How has Yum China Holdings's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-1.0%

YUMC

0.5%

US Hospitality

0.07%

US Market


1 Year Return

38.5%

YUMC

8.5%

US Hospitality

8.9%

US Market

Return vs Industry: YUMC exceeded the US Hospitality industry which returned 8.5% over the past year.

Return vs Market: YUMC exceeded the US Market which returned 8.9% over the past year.


Shareholder returns

YUMCIndustryMarket
7 Day-1.0%0.5%0.07%
30 Day-4.8%-2.6%-0.3%
90 Day-3.2%-5.9%-1.6%
1 Year40.2%38.5%11.2%8.5%11.3%8.9%
3 Year79.3%75.3%43.6%34.1%46.3%36.8%
5 Yearn/a39.5%24.2%62.1%44.3%

Price Volatility Vs. Market

How volatile is Yum China Holdings's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Yum China Holdings undervalued compared to its fair value and its price relative to the market?

1.1%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: YUMC ($43.39) is trading below our estimate of fair value ($43.85)

Significantly Below Fair Value: YUMC is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: YUMC is poor value based on its PE Ratio (24.4x) compared to the Hospitality industry average (22x).

PE vs Market: YUMC is poor value based on its PE Ratio (24.4x) compared to the US market (17.8x).


Price to Earnings Growth Ratio

PEG Ratio: YUMC is poor value based on its PEG Ratio (2.4x)


Price to Book Ratio

PB vs Industry: YUMC is overvalued based on its PB Ratio (5.5x) compared to the US Hospitality industry average (2.3x).


Next Steps

Future Growth

How is Yum China Holdings forecast to perform in the next 1 to 3 years based on estimates from 14 analysts?

10.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: YUMC's forecast earnings growth (10.3% per year) is above the savings rate (2.7%).

Earnings vs Market: YUMC's earnings (10.3% per year) are forecast to grow slower than the US market (14.5% per year).

High Growth Earnings: YUMC's earnings are forecast to grow, but not significantly.

Revenue vs Market: YUMC's revenue (7% per year) is forecast to grow slower than the US market (7.2% per year).

High Growth Revenue: YUMC's revenue (7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: YUMC's Return on Equity is forecast to be high in 3 years time (21.1%)


Next Steps

Past Performance

How has Yum China Holdings performed over the past 5 years?

27.1%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: YUMC's earnings have grown significantly by 27.1% per year over the past 5 years.

Accelerating Growth: YUMC's earnings growth over the past year (35.4%) exceeds its 5-year average (27.1% per year).

Earnings vs Industry: YUMC earnings growth over the past year (35.4%) exceeded the Hospitality industry -14.8%.


Return on Equity

High ROE: YUMC's Return on Equity (22.9%) is considered high.


Return on Assets

ROA vs Industry: YUMC has a higher Return on Assets than the Hospitality industry average last year.


Return on Capital Employed

ROCE Improving: YUMC's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Yum China Holdings's financial position?


Financial Position Analysis

Short Term Liabilities: YUMC's short term assets ($2.1B) exceeds its short term liabilities ($1.6B)

Long Term Liabilities: YUMC's short term assets (2.1B) exceeds its long term liabilities (2.0B)


Debt to Equity History and Analysis

Debt Level: YUMC is debt free.

Reducing Debt: YUMC has not had any debt for past 5 years.

Debt Coverage: YUMC has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: YUMC has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: YUMC has a high level of physical assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if YUMC's debt is covered by short term assets.


Next Steps

Dividend

What is Yum China Holdings's current dividend yield, its reliability and sustainability?

1.11%

Current Dividend Yield


Dividend Yield vs Market

company1.1%marketbottom25%1.4%markettop25%3.7%industryaverage2.9%forecastin3Years1.2%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: YUMC's dividend (1.11%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: YUMC's dividend (1.11%) is low compared to the top 25% of dividend payers in the US market (3.68%).

Stable Dividend: Whilst dividend payments have been stable, YUMC has been paying a dividend for less than 10 years.

Growing Dividend: YUMC's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (25.8%), YUMC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: YUMC's dividends in 3 years are forecast to be well covered by earnings (25% payout ratio).


Next Steps

Management

What is the CEO of Yum China Holdings's salary, the management and board of directors tenure and is there insider trading?

1.6yrs

Average management tenure


CEO

Joey Wat (48yo)

1.6yrs

Tenure

US$10,486,376

Compensation

Ms. Joey Wat has been the Chief Executive Officer of Yum China Holding, Inc since March 1, 2018 and has served as its President and Chief Operating Officer since February 7, 2017 until February 2018 and se ...


CEO Compensation Analysis

Compensation vs. Market: Insufficient data to establish whether Joey's total compensation is reasonable compared to companies of similar size in the US market.

Compensation vs Earnings: Joey's compensation has increased by more than 20% in the past year.


Management Age and Tenure

1.6yrs

Average Tenure

49.5yo

Average Age

Experienced Management: YUMC's management team is not considered experienced ( 1.6 years average tenure), which suggests a new team.


Board Age and Tenure

3.0yrs

Average Tenure

60yo

Average Age

Experienced Board: YUMC's board of directors are considered experienced (3 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$92,03612 Feb 19
Ted Lee
EntityIndividual
Shares2,246
Max PriceUS$40.98
SellUS$137,61215 Nov 18
Ted Lee
EntityIndividual
Shares3,795
Max PriceUS$36.26
SellUS$214,21913 Nov 18
Riu Sun
EntityIndividual
Shares5,869
Max PriceUS$36.50

Ownership Breakdown


Management Team

  • Micky Pant (64yo)

    Vice Chairman & Senior Advisor

    • Tenure: 1.6yrs
    • Compensation: US$1.28m
  • Joseph Chan

    Chief Legal Officer

    • Tenure: 0.3yrs
  • Joey Wat (48yo)

    CEO & Director

    • Tenure: 1.6yrs
    • Compensation: US$10.49m
  • Danny Tan (50yo)

    Chief Supply Chain Officer

    • Tenure: 3yrs
    • Compensation: US$3.25m
  • Alice Wang (49yo)

    Chief Public Affairs Officer

    • Tenure: 2.6yrs
  • Christie Ju

    Vice President of Finance & Investor Relations

    • Tenure: 0yrs
  • Xueling Lu (45yo)

    Controller & Principal Accounting Officer

    • Tenure: 1.8yrs
  • Aiken Yuen (59yo)

    Chief People Officer

    • Tenure: 1.6yrs
  • Leila Zhang

    Chief Technology Officer

    • Tenure: 0yrs
  • Steven Li

    Chief Marketing Officer

    • Tenure: 0yrs

Board Members

  • Christian Campbell (68yo)

    Director

    • Tenure: 3yrs
    • Compensation: US$181.25k
  • Pete Bassi (70yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$181.25k
  • Jon Linen (75yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$181.25k
  • Elias Ettedgui (65yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$195.00k
  • Louis Hsieh (55yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$202.92k
  • Ruby Lu (48yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$181.25k
  • Fred Hu (56yo)

    Non-Executive Chairman

    • Tenure: 2.9yrs
    • Compensation: US$323.33k
  • Micky Pant (64yo)

    Vice Chairman & Senior Advisor

    • Tenure: 1.6yrs
    • Compensation: US$1.28m
  • Ed Chan (56yo)

    Independent Director

    • Tenure: 3yrs
    • Compensation: US$181.25k
  • Joey Wat (48yo)

    CEO & Director

    • Tenure: 1.6yrs
    • Compensation: US$10.49m

Company Information

Yum China Holdings, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Yum China Holdings, Inc.
  • Ticker: YUMC
  • Exchange: NYSE
  • Founded: 2016
  • Industry: Restaurants
  • Sector: Consumer Services
  • Market Cap: US$16.351b
  • Shares outstanding: 376.83m
  • Website: https://www.yumchina.com

Number of Employees


Location

  • Yum China Holdings, Inc.
  • Yum China Building
  • 20 Tian Yao Qiao Road
  • Shanghai
  • 200030
  • China

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
YUMCNYSE (New York Stock Exchange)YesCommon StockUSUSDOct 2016
0YUDB (Deutsche Boerse AG)YesCommon StockDEEUROct 2016
YUMC *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNOct 2016
0M30LSE (London Stock Exchange)YesCommon StockGBUSDOct 2016

Biography

Yum China Holdings, Inc. owns, operates, and franchises restaurants in China. The company operates in two segments, KFC and Pizza Hut. It operates restaurants under the KFC, Pizza Hut, Taco Bell, East Dawn ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/23 00:41
End of Day Share Price2019/10/22 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.