YUM! Brands Inc. Earnings: Margins Expand and Profit Climbs

S&P 500 (NYSE:SPY) component YUM! Brands Inc. (NYSE:YUM) reported its results for the first quarter. Yum Brands develops, operates, franchises and licenses a system of restaurants.

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YUM! Brands Earnings Cheat Sheet for the First Quarter

Results: Net income for YUM! Brands Inc. rose to $458 million (96 cents per share) vs. $264 million (54 cents per share) in the same quarter a year earlier. This marks a rise of 73.5% from the year-earlier quarter.

Revenue: Rose 13.1% to $2.74 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: YUM! Brands Inc. reported adjusted net income of 76 cents per share. By that measure, the company beat the mean estimate of 73 cents per share. Analysts were expecting revenue of $2.7 billion.

Quoting Management: David C. Novak, Chairman and CEO, said, “I am pleased to report each of our divisions produced impressive sales and profit results, driving 21% first-quarter EPS growth. Given the strength of our first-quarter results, we are raising our full-year EPS growth forecast to at least 12%, excluding Special Items.”

Key Stats:

The company has now seen its net income rise for three quarters in a row. In the fourth quarter of the last fiscal year, net income rose 29.9% and in the third quarter of the last fiscal year, the figure rose 7.3%.

The company has now topped analyst estimates for the last four quarters. It beat the mark by one cent in the fourth quarter of the last fiscal year, by one cent in the third quarter of the last fiscal year, and by 5 cents in the second quarter of the last fiscal year.

Revenue has increased for four consecutive quarters. Revenue increased 15.4% to $4.11 billion in the fourth quarter of the last fiscal year. The figure rose 14.4% in the third quarter of the last fiscal year from the year earlier and climbed 9.4% in the second quarter of the last fiscal year from the year-ago quarter.

Looking Forward: Expectations for the second quarter have not changed from 70 cents. For the fiscal year, the average estimate has moved up from $3.22 a share to $3.28 over the last ninety days.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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