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YUM Third Quarter Earnings
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YUM
YUM! Brands (NYSE:YUM) announced its results for the most recent quarter on October 9, 2012. Yum Brands develops, operates, franchises and licenses a system of restaurants.
Investors should care about a company's quarterly earnings because it shows the state of the business over the past 90 days and provides guidance for the following 90 days. SEE: Can Earnings Guidance Accurately Predict The Future?
The Numbers: YUM's latest numbers were good, as the company announced EPS and revenues that came in ahead predictions. The company reported $1 per share versus the 98 cents per share estimate and revenues of $3.57 billion versus the $3.12 billion estimate. EPS rose 25% while revenue climbed 9% from the same period last year. YUM's revenue has grown during each of the past four quarters on a year-over-year basis. YUM's net income for the third quarter was $471 million. According to the reported number, this is up 23% from last year's figures. Last quarter marked the third in a row of rising net income.
Management Quote: David C. Novak, Chairman and CEO, said, "Very strong sales and profit at all of our divisions, including China, Yum! Restaurants International, India and the U.S., drove 19% third-quarter EPS growth. Given the strength of our year-to-date results, I'm pleased to report we are raising our full-year EPS growth forecast to at least 13%, excluding Special Items."
A Look Back: Margins rose in the second quarter after falling the quarter before. Gross margin grew 0.8 percentage point from the year-earlier quarter to 28.7%. In the first quarter, the figure rose 1.2 percentage points to 26.2% from the year earlier quarter.
Net income has increased 27.7% year-over-year on average across the last five quarters. The biggest gain came in the first quarter, when income climbed 73.5% from the year-earlier quarter.
Looking Ahead: Analysts appear increasingly negative about the company's results for the next quarter. The average estimate for the fourth quarter has moved down from 87 cents a share to 86 cents over the last 90 days. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. The average estimate for the fiscal year is $3.26 per share, down from $3.32 90 days ago.
Investors should care about a company's quarterly earnings because it shows the state of the business over the past 90 days and provides guidance for the following 90 days. SEE: Can Earnings Guidance Accurately Predict The Future?
The Numbers: YUM's latest numbers were good, as the company announced EPS and revenues that came in ahead predictions. The company reported $1 per share versus the 98 cents per share estimate and revenues of $3.57 billion versus the $3.12 billion estimate. EPS rose 25% while revenue climbed 9% from the same period last year. YUM's revenue has grown during each of the past four quarters on a year-over-year basis. YUM's net income for the third quarter was $471 million. According to the reported number, this is up 23% from last year's figures. Last quarter marked the third in a row of rising net income.
Management Quote: David C. Novak, Chairman and CEO, said, "Very strong sales and profit at all of our divisions, including China, Yum! Restaurants International, India and the U.S., drove 19% third-quarter EPS growth. Given the strength of our year-to-date results, I'm pleased to report we are raising our full-year EPS growth forecast to at least 13%, excluding Special Items."
A Look Back: Margins rose in the second quarter after falling the quarter before. Gross margin grew 0.8 percentage point from the year-earlier quarter to 28.7%. In the first quarter, the figure rose 1.2 percentage points to 26.2% from the year earlier quarter.
Net income has increased 27.7% year-over-year on average across the last five quarters. The biggest gain came in the first quarter, when income climbed 73.5% from the year-earlier quarter.
Looking Ahead: Analysts appear increasingly negative about the company's results for the next quarter. The average estimate for the fourth quarter has moved down from 87 cents a share to 86 cents over the last 90 days. A decreasing earning estimate is a negative sign and usually leads to a drop in the stock price. The average estimate for the fiscal year is $3.26 per share, down from $3.32 90 days ago.
by
Investopedia Staff
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