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Yum! Brands’ Price Has Fallen 14.8% Year-to-Date

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Yum! Brands earnings

Yum! Brands (YUM) is set to announce its 4Q15 earnings after the market closes on February 3, 2016. Since its 3Q15 earnings announcement, YUM’s stock has fallen 14.8%, and YTD (year-to-date) in 2016, the stock is down 3.3%.

The Consumer Discretionary Select Sector SPDR ETF (XLY) is also down 6.6% YTD. XLY holds restaurant stocks such as Starbucks (SBUX), Chipotle Mexican Grill (CMG), and McDonald’s (MCD).

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Shares fall

Yum! Brands’ share price fell 18% to about ~$68 per share after the company missed its key growth metrics in its 3Q15 earnings. Investors were disappointed, and the stock took a big tumble. The above graph clearly drives this point home.

Yum! Brands is heavily present in China, and much of its revenue comes from this region. Investors were concerned with the pace at which the company was making progress after the meat supplier issue that hit it almost five quarters ago.

Series overview

This series will help you to prepare for YUM’s upcoming 4Q15 earnings. Before the earnings, it’s important to look at Wall Street’s expectations for some of the company’s key metrics such as revenue, same-store sales growth, margins, and EPS (earnings per share). We’ll also look at Yum! Brands’ valuation multiple as well as its price target for the next 12 months.

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