Oct. 30, 2019, 10:31 a.m. EDT

Why Yum! Brands Couldn’t Stomach Q3 Earnings

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By 24/7 Wall St.

Yum! Brands Inc. (NYSE: YUM) released its third-quarter financial results before the markets opened on Wednesday. The firm said that it had $0.80 in earnings per share (EPS) and $1.34 billion in revenue, compared with consensus estimates that called for $0.94 in EPS and $1.34 billion in revenue. The same period of last year reportedly had $1.04 in EPS and $1.39 billion in revenue.

Worldwide system sales, excluding foreign currency translation, grew 8%, with KFC at 8%, Pizza Hut at 7% and Taco Bell at 7%.

KFC system sales increased 6% year over year to $697 million, with an operating profit of $270 million. Same-store sales grew 3%. The KFC Division opened 411 gross new restaurants in 52 countries as well.

Pizza Hut system sales increased 6% to $241 million, with an operating profit of $86 million. Same-store sales were flat. The Pizza Hut Division opened 205 gross new restaurants in 43 countries for this quarter.

Taco Bell system sales increased 4% to $489 million, with an operating profit of $161 million. Same-store sales increased 5%. The Taco Bell Division opened 67 gross new restaurants in 13 countries.

The company did not offer any guidance in the report. However, consensus estimates call for $1.17 in EPS and $1.65 billion in revenue for the fourth quarter.

Note that CEO Greg Creed will be stepping down from his role at the end of the year. Creed commented on earnings and his departure:

Shares traded down about 9% at $99.99 Wednesday morning, in a 52-week range of $85.81 to $119.72. The consensus price target is $120.32.

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