In a report released today, Sara Senatore from Bank of America Securities reiterated a Hold rating on Yum! Brands (YUM – Research Report), with a price target of $153.00.
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Sara Senatore’s rating is based on a combination of factors affecting Yum! Brands. The company has shown some promising signs of recovery, particularly in the Middle East and Latin America, with sales growth returning to pre-conflict levels and strong comparative sales in various regions. However, international unit development remains a concern, as the projected growth for 2025 is below the long-term target, and closures, especially in countries like Turkey, pose challenges.
Sara Senatore highlighted the need for Yum! Brands to maintain its momentum in top-line growth to meet its EBIT growth targets, as an increase in general and administrative expenses is anticipated for 2025. Additionally, the valuation of the stock is expected to stay within historical ranges due to the limits posed by its franchised portfolio on EPS growth. These elements collectively justify the Hold rating, suggesting a cautious approach given the balance of risks and opportunities.
Senatore covers the Consumer Cyclical sector, focusing on stocks such as Chipotle, Starbucks, and Shake Shack. According to TipRanks, Senatore has an average return of 9.9% and a 56.85% success rate on recommended stocks.