Yum Brands Inc

PepsiCo (PEP) is one of two beverage-industry behemoths. We break down everything investors should know about the stock and the business.

This restaurant industry does well when the economy is expanding and poorly when the economy is contracting. In other words, it’s cyclical.

Domino’s stockholders’ deficit is a result of the company’s recapitalization efforts in 2007 and 2012. This deficit is funded with debt, which can burden a company with interest payments, resulting in a margin squeeze or a loss.

Despite health-related controversies, fast food companies such as McDonald’s maintain that they provide consumers with choice and convenience.

Beyond Meat (BYND) stock fell 10.2% in after-market trading hours on October 28, even as the company reported better-than-expected third-quarter results.

Domino’s reported a disappointing third-quarter financial performance on Tuesday. Domino’s stock pared the initial losses and closed about 5% higher.

More Americans are eating out, and they’re eating out more often. The restaurant industry’s share of the food dollar is 51%, up from 25% in 1955.

Yum! Brands (YUM) posted overall SSSG (same-store sales growth) of 4.0% in the first quarter of 2019, outperforming analysts’ estimate of 2.7%.

Yum! Brands reported revenue of $1.25 billion in the first quarter of 2019, which represented a fall of 8.5% from $1.56 billion in the first quarter of 2018.

Today, J.P. Morgan upgraded Domino’s Pizza (DPZ) from “neutral” to “overweight” while keeping its 12-month price target at $270.

The Walt Disney Company is among those large American companies that have launched back-to-school programs for their employees.

All major pizza companies have announced their 4Q17 earnings, so it’s time to compare their performance.

As of February 14, 2018, Domino’s was trading at a forward PE multiple of 26.5x compared to 31.8% before the announcement of its 3Q17 earnings.

At the end of 4Q17, Yum! Brands operated 45,804 restaurants, which included 21,487 KFC restaurants, 16,748 Pizza Hut restaurants, and 6,849 Taco Bell restaurants.

Due to the high visibility of their earnings, we’ve opted to use the forward PE (price-to-earnings) multiple for our valuation analysis of the pizza companies in this series.

Domino’s better-than-expected SSSG and earnings in 1Q17 appear to have increased investor confidence, leading to rises in DPZ stock and its PE multiple.

In 2016, Domino’s Pizza (DPZ) paid dividends of $1.52—growth of 22.5% from $1.24 in 2015. In 2017, analysts expect its dividends to rise 7.9% to $1.64.

Same-store sales growth SSSG (same-store sales growth), which is expressed as a percentage, is a measure of revenue growth in existing stores over a certain period. SSSG is driven by ticket size and traffic. It’s an important metric for investors to monitor, as it increases a company’s revenue without increasing capital investment, and it’s a […]

Since the E. coli outbreak in October 2015, Chipotle Mexican Grill’s (CMG) same-store sales growth has been falling. This led to negative revenue growth.

On August 29, 2016, Chipotle Mexican Grill (CMG) launched its latest promotional offer, targeting students in the back-to-school season.

In 2Q16, Yum! Brands earned 84.9% of its revenue from company-owned restaurants and 15.1% from franchised restaurants.

Analysts are maintaining a price target of $67.6 for Papa John’s for the next 12-months, which represents a return potential of 2.5% for the company.

SSSG is an important metric for investors to monitor because it increases a fast-food company’s revenue without increasing capital investment.

In July 2013, Buffalo Wild Wings developed a guest experience approach that uses a “captain” to help customers to access all entertainment options.

In addition to its marketing and promotional efforts, Chipotle Mexican Grill (CMG) launched a food safety website on February 8, 2016, which outlines the company’s enhanced food safety procedures.

Chipotle Mexican Grill (CMG) recorded overall same-store sales growth of -14.6% for 4Q15. It was -16% in November and -30% in December, according to the company.

Jack in the Box (JACK) manages marketing funds that include contributions from both its franchise and company-owned restaurants.

To speed up service, Jack in the Box (JACK) used a two-way intercom when it opened its first restaurant in 1951.

Let’s examine the management’s target for the restaurant operating margins for each of Yum! Brands’ divisions in 2016. Please note that the data excludes India.

A company’s incremental operating margin is calculated as the change in operating income divided by the change in revenue over a period.

Chipotle expects its 4Q15 same-store sales growth to range from -8% to -11%. This would be the first time in almost ten years the company expects to report negative same-store sales growth.

When the first cases of E. coli were linked to Chipotle, the company shut down 43 of its restaurants for a week.

Papa John’s was first to introduce online ordering at all of its US delivery restaurants in 2001 as well as first to introduce SMS text ordering in 2007.

In 2014, Papa John’s net profits as a percentage of total sales decreased by 0.2% due to increases in interest levels.

To maintain the quality and consistency of products, Papa John’s has QC (quality control) centers that supply ingredients to its restaurants.

In 2014, Papa John’s spent $63 million, or 4% of its total revenues, on advertising, whereas McDonald’s spent $808 million, or 2.9% of its total revenues.

Shake Shack stated that its limited-time offers, the ShackMeister Burger and Roadside Shack, have been “big drivers” for its ticket and traffic growth.

In 1998, Papa John’s decided to venture outside the US by opening outlets in Mexico and Puerto Rico. In 1999, it acquired the UK’s Perfect Pizza Holdings.

Starbucks has about 5,239 restaurants in the CAP segment. It’s growing units at an average of 18.4% compared to the rest of the regions.

Same-store sales growth is one of the key revenue drivers for a restaurant company like Starbucks (SBUX), McDonald’s (MCD), and Darden Restaurants (DRI).

Although Domino’s is spread over 75 countries, most of the company’s revenue comes from domestic markets and is more sensitive to economic conditions in the US.

In 2Q15, Baskin-Robbins’s US same-store sales growth rate fell to 3.4% compared to 4.2% a year ago. This was driven by ongoing promotions and discounts and a 75% increase in online cake ordering.

According to Starbucks (SBUX) management, the company’s My Starbucks Reward program helps increase customer loyalty.

Domino’s continues its investment in the technology space with its recent launch of Domino’s pizza delivery tracker available on Apple Watch.

Agricultural and livestock commodities such as corn, coffee, beef, pork, chicken, and cheese play an important role in the restaurant business, as demand and supply factors impact prices.

A tight labor market with low unemployment and participation rates puts pressure on restaurant companies to raise wages to retain their employees.

There’s strong acceptance of the Starbucks loyalty program in China, with 40% of transactions completed using the Starbucks card.

The Americas and the CAP (China, Asia-Pacific) segments have been the biggest contributors toward Starbucks global comps growth.

Over the past 12 months, the restaurant industry has experienced significant sales growth. In this series, we’ll look at certain indicators that investors in this sector should track.

Restaurant industry sales have experienced growth in the past 12 months. Sales are poised to grow to $709 billion.