📊 YUM Key Takeaways
Is Yum Brands Inc. (YUM) a Good Investment?
YUM Brands exhibits concerning balance sheet deterioration with negative stockholders' equity of -$7.3B and liabilities exceeding assets by $7.3B, indicating severe financial distress. While operating metrics show strong profitability (31.3% operating margin, 19.0% net margin) and solid cash generation ($1.6B FCF), the inverted capital structure and substantial long-term debt ($11.8B) create significant refinancing and solvency risks that outweigh operational strength.
Yum Brands shows strong underlying profitability and cash generation, with a 31.3% operating margin, 19.0% net margin, and $1.64B of free cash flow on $8.21B of revenue. Net income and diluted EPS continued to grow, which supports the resilience of its asset-light, franchise-heavy model, but the balance sheet remains aggressive with negative equity and $11.83B of long-term debt. The very large reported revenue jump also raises a growth-quality question, making balance sheet discipline and cash conversion more important than top-line growth alone.
Why Buy Yum Brands Inc. Stock? YUM Key Strengths
- Strong operating cash flow generation of $2.0B demonstrates underlying business cash earnings capability
- Exceptional operating margin of 31.3% and net margin of 19.0% show efficient operations and pricing power
- Solid free cash flow of $1.6B with 20% FCF margin indicates ability to service debt despite balance sheet stress
- High-margin business model with 31.3% operating margin and 19.0% net margin
- Strong cash generation with $2.01B operating cash flow and $1.64B free cash flow
- Earnings growth remained positive, with net income up 4.9% and diluted EPS up 6.3%
YUM Stock Risks: Yum Brands Inc. Investment Risks
- Negative stockholders' equity of -$7.3B signals technical insolvency and indicates excessive financial leverage or asset impairment
- Total liabilities of $15.5B exceed total assets of $8.2B by $7.3B, creating structural balance sheet imbalance
- Long-term debt of $11.8B combined with negative equity creates acute refinancing risk and limits financial flexibility
- Extreme revenue growth of 1739.5% YoY appears anomalous and suggests potential accounting changes, acquisitions, or non-recurring items requiring investigation
- Negative stockholders equity indicates an aggressively levered capital structure
- Long-term debt of $11.83B and interest coverage of 4.7x limit financial flexibility
- Revenue growth of 1739.5% YoY appears unusually large and may reflect reporting or mix changes rather than purely organic expansion
Key Metrics to Watch
- Stockholders' equity trend and path to positive equity restoration
- Long-term debt levels and refinancing schedule maturity profile
- Operating cash flow sustainability and capital allocation decisions
- Revenue normalization and recurring revenue quality after unusual 1739.5% growth
- Interest coverage and long-term debt reduction
- Free cash flow conversion relative to net income
Yum Brands Inc. (YUM) Financial Metrics & Key Ratios
💡 AI Analyst Insight
Yum Brands Inc. presents a mixed fundamental picture. Review the detailed metrics above to form your own investment thesis.
YUM Profit Margin, ROE & Profitability Analysis
YUM vs Consumer Sector: How Yum Brands Inc. Compares
How Yum Brands Inc. compares to Consumer sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Yum Brands Inc. Stock Overvalued? YUM Valuation Analysis 2026
Based on fundamental analysis, Yum Brands Inc. has mixed fundamental signals relative to the Consumer sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Yum Brands Inc. Balance Sheet: YUM Debt, Cash & Liquidity
YUM Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Yum Brands Inc.'s revenue has grown significantly by 25% over the 5-year period, indicating strong business expansion. The most recent EPS of $5.59 reflects profitable operations.
YUM Revenue Growth, EPS Growth & YoY Performance
YUM Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $1.8B | $382.0M | $1.35 |
| Q2 2025 | $1.8B | $367.0M | $1.28 |
| Q1 2025 | $1.6B | $253.0M | $0.90 |
| Q3 2024 | $1.7B | $382.0M | $1.35 |
| Q2 2024 | $1.7B | $367.0M | $1.28 |
| Q1 2024 | $1.6B | $300.0M | $1.05 |
| Q3 2023 | $1.6B | $331.0M | $1.14 |
| Q2 2023 | $1.6B | $224.0M | $0.77 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Yum Brands Inc. Dividends, Buybacks & Capital Allocation
YUM SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Yum Brands Inc. (CIK: 0001041061)
📋 Recent SEC Filings
❓ Frequently Asked Questions about YUM
What is the AI rating for YUM?
Yum Brands Inc. (YUM) has a Combined AI Rating of SELL from Claude (SELL) and ChatGPT (HOLD) with 82% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are YUM's key strengths?
Claude: Strong operating cash flow generation of $2.0B demonstrates underlying business cash earnings capability. Exceptional operating margin of 31.3% and net margin of 19.0% show efficient operations and pricing power. ChatGPT: High-margin business model with 31.3% operating margin and 19.0% net margin. Strong cash generation with $2.01B operating cash flow and $1.64B free cash flow.
What are the risks of investing in YUM?
Claude: Negative stockholders' equity of -$7.3B signals technical insolvency and indicates excessive financial leverage or asset impairment. Total liabilities of $15.5B exceed total assets of $8.2B by $7.3B, creating structural balance sheet imbalance. ChatGPT: Negative stockholders equity indicates an aggressively levered capital structure. Long-term debt of $11.83B and interest coverage of 4.7x limit financial flexibility.
What is YUM's revenue and growth?
Yum Brands Inc. reported revenue of $8.2B.
Does YUM pay dividends?
Yum Brands Inc. pays dividends, with $789.0M distributed to shareholders in the trailing twelve months.
Where can I find YUM SEC filings?
Official SEC filings for Yum Brands Inc. (CIK: 0001041061) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is YUM's EPS?
Yum Brands Inc. has a diluted EPS of $5.55.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is YUM a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Yum Brands Inc. has a SELL rating with 82% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is YUM stock overvalued or undervalued?
Valuation metrics for YUM: ROE of N/A (sector avg: 18%), net margin of 19.0% (sector avg: 8%). Compare these metrics with sector averages to assess valuation.
Should I buy YUM stock in 2026?
Our dual AI analysis gives Yum Brands Inc. a combined SELL rating for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is YUM's free cash flow?
Yum Brands Inc.'s operating cash flow is $2.0B, with capital expenditures of $371.0M. FCF margin is 20.0%.
How does YUM compare to other Consumer stocks?
Vs Consumer sector averages: Net margin 19.0% (avg: 8%), ROE N/A (avg: 18%), current ratio 1.35 (avg: 1.5).