Jefferies Cuts Price Target on Yum! Brands (YUM) Following China Spin-Off
- Top 10 News for 12/2: Crude Rips on OPEC Cut; Starbucks' Schultz Steps Down; Nonfarm Payrolls Flat in Nov.
- Unemployment Rate Drops to 4.6%
- Bond yields slip on U.S. jobs data, euro steady before Italy vote
- Alibaba (BABA) Founder Jack Ma Discuss Plans to Retire; 'I Don't Want to Die at the Office'
- Starbucks Coffee (SBUX) CEO Howard Schultz to Step Down, Appointed Executive Chairman; Kevin Johnson New CEO
Get daily under-the-radar research with StreetInsider.com's Stealth Growth Insider Get your 2-Wk Free Trial here.
Jefferies maintained a Hold rating on Yum! Brands (NYSE: YUM), and cut the price target to $60.00 (from $85.00), following the company's split from China. The next potential catalyst for YUM will be around further re-franchising as it looks to get from ~93% to ~98% franchised by 2018 with net G&A savings of $300mm and at least $3.75 of EPS by 2019. To achieve its $3.75 EPS target for 2019, YUM will need to exit 2018 with at least ~$3.30 of EPS.
Analyst Andy Barish commented, "Updating our model and price target following the split from China. With the China spin-off now complete, the outlook for YUM will return to fundamentals and its 98% franchised target with $300mm net G&A savings and at least $3.75 of EPS by 2019. We are taking a conservative approach and not modeling any benefits from further re-franchising given the uncertainty around timing. Our PT goes to $60 from $85, based on 14x our '17 EBITDA est. We remain at Hold."
Shares of Yum! Brands closed at $62.36 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Jefferies Cuts Price Target on Kroger (KR) to $30 Following 3Q and Guidance
- Jefferies Cuts Price Target on Dollar General (DG) Following 3Q
- Karyopharm Therapeutics (KPTI):Selinexor At ASH Could Drive Upside - Jefferies
Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst PT Change
Related EntitiesJefferies & Co
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!