YUM CHINA HOLDINGS INC (YUMC)
US98850P1093 - Common Stock
Taking everything into account, YUMC scores 6 out of 10 in our fundamental rating. YUMC was compared to 135 industry peers in the Hotels, Restaurants & Leisure industry. YUMC has an excellent financial health rating, but there are some minor concerns on its profitability. YUMC is growing strongly while it is still valued neutral. This is a good combination! With these ratings, YUMC could be worth investigating further for growth investing!.
1. Profitability
1.1 Basic Checks
YUMC had positive earnings in the past year.
In the past year YUMC had a positive cash flow from operations.
Each year in the past 5 years YUMC has been profitable.
YUMC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of YUMC (6.87%) is better than 77.61% of its industry peers.
With a decent Return On Equity value of 12.91%, YUMC is doing good in the industry, outperforming 67.91% of the companies in the same industry.
The Return On Invested Capital of YUMC (8.31%) is better than 66.42% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for YUMC is below the industry average of 10.33%.
The last Return On Invested Capital (8.31%) for YUMC is above the 3 year average (6.34%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.87% | ||
| ROE | 12.91% | ||
| ROIC | 8.31% |
ROA(3y)6.03%
ROA(5y)7.11%
ROE(3y)11.25%
ROE(5y)13.91%
ROIC(3y)6.34%
ROIC(5y)7.4%
1.3 Margins
The Profit Margin of YUMC (7.53%) is better than 65.67% of its industry peers.
YUMC's Profit Margin has declined in the last couple of years.
YUMC's Operating Margin of 10.35% is in line compared to the rest of the industry. YUMC outperforms 55.97% of its industry peers.
YUMC's Operating Margin has been stable in the last couple of years.
Looking at the Gross Margin, with a value of 42.57%, YUMC is doing worse than 63.43% of the companies in the same industry.
In the last couple of years the Gross Margin of YUMC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.35% | ||
| PM (TTM) | 7.53% | ||
| GM | 42.57% |
OM growth 3Y5.33%
OM growth 5Y0.95%
PM growth 3Y-7.4%
PM growth 5Y-2.19%
GM growth 3Y-0.38%
GM growth 5Y-1.07%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so YUMC is still creating some value.
YUMC has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, YUMC has more shares outstanding
YUMC has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 3.23 indicates that YUMC is not in any danger for bankruptcy at the moment.
YUMC's Altman-Z score of 3.23 is amongst the best of the industry. YUMC outperforms 83.58% of its industry peers.
YUMC has a debt to FCF ratio of 0.28. This is a very positive value and a sign of high solvency as it would only need 0.28 years to pay back of all of its debts.
YUMC has a better Debt to FCF ratio (0.28) than 94.03% of its industry peers.
YUMC has a Debt/Equity ratio of 0.03. This is a healthy value indicating a solid balance between debt and equity.
With an excellent Debt to Equity ratio value of 0.03, YUMC belongs to the best of the industry, outperforming 86.57% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.03 | ||
| Debt/FCF | 0.28 | ||
| Altman-Z | 3.23 |
ROIC/WACC1.11
WACC7.51%
2.3 Liquidity
A Current Ratio of 1.42 indicates that YUMC should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.42, YUMC is in the better half of the industry, outperforming 70.15% of the companies in the same industry.
A Quick Ratio of 1.24 indicates that YUMC should not have too much problems paying its short term obligations.
YUMC's Quick ratio of 1.24 is fine compared to the rest of the industry. YUMC outperforms 64.93% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.42 | ||
| Quick Ratio | 1.24 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 90.48% over the past year.
YUMC shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 5.09% yearly.
Looking at the last year, YUMC shows a quite strong growth in Revenue. The Revenue has grown by 14.72% in the last year.
YUMC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.46% yearly.
EPS 1Y (TTM)90.48%
EPS 3Y9.1%
EPS 5Y5.09%
EPS growth Q2Q108.33%
Revenue 1Y (TTM)14.72%
Revenue growth 3Y9.93%
Revenue growth 5Y5.46%
Revenue growth Q2Q19.4%
3.2 Future
Based on estimates for the next years, YUMC will show a very strong growth in Earnings Per Share. The EPS will grow by 23.40% on average per year.
The Revenue is expected to grow by 11.45% on average over the next years. This is quite good.
EPS Next Y12.25%
EPS Next 2Y12.95%
EPS Next 3Y13.21%
EPS Next 5Y23.4%
Revenue Next Year10.62%
Revenue Next 2Y10.43%
Revenue Next 3Y10.2%
Revenue Next 5Y11.45%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.82, the valuation of YUMC can be described as rather expensive.
Based on the Price/Earnings ratio, YUMC is valued a bit cheaper than 69.40% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 24.92. YUMC is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 17.66 indicates a rather expensive valuation of YUMC.
Based on the Price/Forward Earnings ratio, YUMC is valued a bit cheaper than 67.91% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 21.49. YUMC is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.83 | ||
| Fwd PE | 17.66 |
4.2 Price Multiples
81.34% of the companies in the same industry are more expensive than YUMC, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, YUMC is valued a bit cheaper than the industry average as 67.91% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.37 | ||
| EV/EBITDA | 7.1 |
4.3 Compensation for Growth
YUMC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of YUMC may justify a higher PE ratio.
YUMC's earnings are expected to grow with 13.21% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.62
PEG (5Y)3.89
EPS Next 2Y12.95%
EPS Next 3Y13.21%
5. Dividend
5.1 Amount
YUMC has a Yearly Dividend Yield of 1.72%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 2.62, YUMC pays a bit more dividend than its industry peers.
YUMC's Dividend Yield is slightly below the S&P500 average, which is at 2.43.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.72% |
5.2 History
The dividend of YUMC has a limited annual growth rate of 4.41%.
YUMC has been paying a dividend for over 5 years, so it has already some track record.
YUMC has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)4.41%
Div Incr Years1
Div Non Decr Years3
5.3 Sustainability
26.12% of the earnings are spent on dividend by YUMC. This is a low number and sustainable payout ratio.
YUMC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP26.12%
EPS Next 2Y12.95%
EPS Next 3Y13.21%
YUM CHINA HOLDINGS INC
NYSE:YUMC (4/26/2024, 6:27:45 PM)
After market: 39.65 0 (0%)39.65
+0.61 (+1.56%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap15.54B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.72% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(4)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
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Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.83 | ||
| Fwd PE | 17.66 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.62
PEG (5Y)3.89
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.87% | ||
| ROE | 12.91% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 10.35% | ||
| PM (TTM) | 7.53% | ||
| GM | 42.57% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.91
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.03 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.42 | ||
| Quick Ratio | 1.24 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)90.48%
EPS 3Y9.1%
EPS 5Y
EPS growth Q2Q
EPS Next Y12.25%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)14.72%
Revenue growth 3Y9.93%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y