Will Yum Brands deliver good results?

Yum Brands will report its third-quarter earnings on Tuesday 7 October. The consensus is for revenue of $3.4 billion and earnings per share of 90 cents.

A Pizza Hut branch
Source: Bloomberg

Yum Brands is trading at $71.75, and the stock is down 13% since it reported its second-quarter figures in July, where revenue and EPS came in better than the average estimates but still missed some of the top-end estimates by a considerable margin.

The larger-than-expected decline in revenue from its Pizza Hut division spooked traders, with the business under increasing pressure from Domino's Pizza Group.

The company own a number of well-known fast food outlets such as KFC and Pizza Hut, which have both suffered negative press after a TV show highlighted improper meat handling in some of its restaurants in China.

Equity analysts are bullish on Yum Brands. Out of the 29 recommendations, 11 are buys and 18 are holds.  

The stock gapped lower and seemed to find stability at the $70 level. If the company is confident it can achieve its full-year target the share price could move to $74.82.

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