Magellan Asset Management Ltd Acquires New Stake in Yum! Brands, Inc. $YUM

Magellan Asset Management Ltd bought a new position in Yum! Brands, Inc. (NYSE:YUM) during the second quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The firm bought 358,827 shares of the restaurant operator’s stock, valued at approximately $57,362,000. Yum! Brands accounts for about 1.3% of Magellan Asset Management Ltd’s investment portfolio, making the stock its 22nd largest holding. Magellan Asset Management Ltd owned about 0.13% of Yum! Brands as of its most recent filing with the Securities & Exchange Commission.

Several other institutional investors and hedge funds have also made changes to their positions in the business. Haverford Trust Co bought a new position in shares of Yum! Brands in the second quarter worth about $218,000. Bank of Nova Scotia bought a new stake in shares of Yum! Brands in the 2nd quarter valued at about $20,770,000. Elevation Point Wealth Partners LLC purchased a new stake in shares of Yum! Brands in the 2nd quarter worth approximately $972,000. Daiichi Life Insurance Co. Ltd. purchased a new position in Yum! Brands during the second quarter valued at approximately $5,087,000. Finally, Commerce Bank purchased a new stake in Yum! Brands during the second quarter worth $11,453,000. 82.37% of the stock is currently owned by institutional investors.

Yum! Brands Price Performance

Shares of Yum! Brands stock opened at $153.31 on Monday. The business has a 50 day simple moving average of $153.43 and a two-hundred day simple moving average of $155.98. The stock has a market capitalization of $41.84 billion, a P/E ratio of 19.28, a PEG ratio of 2.48 and a beta of 0.55. Yum! Brands, Inc. has a 12 month low of $137.33 and a 12 month high of $170.14.

Yum! Brands (NYSE:YUM) last issued its earnings results on Thursday, July 30th. The restaurant operator reported $1.62 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.58 by $0.04. Yum! Brands had a negative return on equity of 24.57% and a net margin of 25.42%.The business had revenue of $2.17 billion during the quarter, compared to the consensus estimate of $2.18 billion. During the same period last year, the company earned $1.44 EPS. The company’s revenue for the quarter was up 12.2% on a year-over-year basis. As a group, research analysts anticipate that Yum! Brands, Inc. will post 6.42 EPS for the current fiscal year.

Yum! Brands announced that its Board of Directors has authorized a share buyback program on Tuesday, June 16th that allows the company to buyback $4.00 billion in shares. This buyback authorization allows the restaurant operator to reacquire up to 9.4% of its stock through open market purchases. Stock buyback programs are often an indication that the company’s board of directors believes its shares are undervalued.

Insider Transactions at Yum! Brands

In other news, CEO Christopher Lee Turner sold 270 shares of the stock in a transaction dated Monday, June 1st. The stock was sold at an average price of $148.14, for a total value of $39,997.80. Following the transaction, the chief executive officer owned 64,282 shares in the company, valued at approximately $9,522,735.48. This represents a 0.42% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Scott Mezvinsky sold 277 shares of the company’s stock in a transaction on Wednesday, July 1st. The shares were sold at an average price of $160.42, for a total transaction of $44,436.34. Following the completion of the transaction, the chief executive officer owned 483 shares of the company’s stock, valued at $77,482.86. This represents a 36.45% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 18,549 shares of company stock valued at $2,890,168 in the last 90 days. Insiders own 0.14% of the company’s stock.

Yum! Brands News Roundup

Here are the key news stories impacting Yum! Brands this week:

• Positive Sentiment: Yum! Brands outlined a renewed consumer-growth strategy centered on strengthening brand engagement, digital capabilities, loyalty programs and operational execution across KFC, Taco Bell and Pizza Hut. The emphasis on personalized customer experiences and technology could support sales and franchisee performance. Yum! Brands Reveals New Path for Consumer Growth
• Positive Sentiment: The company appointed former HanesBrands CEO Steve Bratspies to its board, effective August 26. His experience managing global consumer brands and improving operations may add expertise as Yum! pursues growth and evaluates its portfolio. Yum! Brands Appoints Steve Bratspies to Board
• Neutral Sentiment: Pizza Hut is using a football-themed branding promotion ahead of the NFL season. The marketing effort could increase near-term visibility, but it comes as Yum! advances the multibillion-dollar sale of the chain, making the strategic implications more important than the promotion itself. Pizza Hut Branding Change
• Negative Sentiment: Shares faced pressure after Yum! announced a new chief executive officer. Although a leadership change could bring fresh momentum, investors may be concerned about execution risk and the direction of the company during the transition. Yum! Brands Slides on Naming New CEO
• Negative Sentiment: An insider reportedly reduced a Yum! Brands equity stake by 28%, while executive share withholding related to restricted-stock-unit vesting was also disclosed. These transactions are not necessarily signals of deteriorating fundamentals, but they can weigh on sentiment. Yum! Brands Insider Sale
• Negative Sentiment: Pomerantz LLP said it is investigating potential claims on behalf of Yum! investors. The announcement does not establish wrongdoing, but it adds legal and reputational uncertainty to the stock. Pomerantz Investor Investigation

Analyst Upgrades and Downgrades

A number of research analysts have recently issued reports on the stock. TD Cowen reaffirmed a “buy” rating and issued a $180.00 price objective on shares of Yum! Brands in a research report on Tuesday, June 16th. Citigroup increased their price target on Yum! Brands from $175.00 to $178.00 and gave the company a “neutral” rating in a research note on Sunday, July 12th. Evercore restated an “outperform” rating on shares of Yum! Brands in a research note on Tuesday, June 16th. Wells Fargo & Company boosted their target price on shares of Yum! Brands from $160.00 to $165.00 and gave the stock an “equal weight” rating in a research report on Thursday, April 30th. Finally, Morgan Stanley raised shares of Yum! Brands from an “equal weight” rating to an “overweight” rating and boosted their price objective for the company from $180.00 to $185.00 in a report on Wednesday, June 3rd. Twelve investment analysts have rated the stock with a Buy rating and seven have assigned a Hold rating to the stock. According to MarketBeat.com, Yum! Brands presently has an average rating of “Moderate Buy” and a consensus price target of $174.65.

Yum! Brands Profile

Yum! Brands, Inc (NYSE: YUM) is a global quick-service restaurant company that develops, operates and franchises a portfolio of well-known restaurant brands. The company’s principal brands are KFC, Pizza Hut and Taco Bell, each focused on distinct product categories—KFC on fried chicken and related menu items, Pizza Hut on pizza and complementary offerings, and Taco Bell on Mexican-inspired quick-service food. Yum! is headquartered in Louisville, Kentucky and was formed as Tricon Global Restaurants in 1997 when PepsiCo spun off its restaurant businesses, later adopting the Yum! Brands name.

The company’s operating model centers on brand development, system growth and franchising; a large portion of its restaurants are operated by independent franchisees, and Yum! generates revenue through franchise royalties and fees in addition to sales from company-operated locations.