Yum! Brands

[DividendDragon]

Massive drop amid china fears.

Goes to show when people buy into hot air and crazy valuations.

I'd be tempted at $60. What are all your thoughts on the matter?

DD

[EricL]

(10-07-2015, 06:21 AM)DividendDragon Wrote: Massive drop amid china fears.

Goes to show when people buy into hot air and crazy valuations.

I'd be tempted at $60. What are all your thoughts on the matter?

DD

$60 would be a 3.07% yield on the newly raised payout of $0.46 per quarter. I think it would definitely be worth considering there. I think $65 would even start to be tempting.

[Dividendsrule]

60 is decent. I am happy to share my thoughts here. Ok, here is my concern. They earned a buck in the quarter. They pay out .46. So we are talking, very simplistically, about around a 50% payout ratio for a rather undiversified group of restaurants. The pizza, the chicken, and taco bell which is the bright spot, popular among millenials. But with management guiding what, growth in the mid single digits going forward, I would probably want a bit over a 3% yield for that. So yes, 60...Maybe even lower.
I guess I'm tempering my enthusiasm to buy right now...I think I'd want a bit more bang for my buck here.

[KenBob]

Since YUM is not on my shortlist, I don't have a stake, but I do have an intellectual issue.

YUM is essentially an American fast food company which gets most of profits globally. How secure are these profits considering that its product may be a fad for its global costumers?

I don't know the answer, but I am asking for your thoughts.

[benjamen]

Looking at their income statement:
Declining Revenue
Declining Net Income
Looking at their balance sheet:
Current liabilities exceed current assets, but less total debt than total assets
Total Dividends/Total Net Income over 60%
PE ratio over 30
Yield under 2.5%

Generally, not an attractive entry point right now.