Analyst Chen Luo from Bank of America Securities maintained a Buy rating on Yum China Holdings and keeping the price target at $56.50.
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Chen Luo’s rating is based on several key factors that highlight Yum China Holdings’ potential for steady growth and shareholder returns. The company is on track to expand its store count to 20,000 by the end of 2026, which indicates a robust growth strategy. This expansion is complemented by a focus on smaller store formats and franchising, which could enhance operational efficiency and market penetration.
Moreover, Yum China is expected to deliver medium-term growth in system sales, operating profit, and earnings per share, with a projected annual total return in the low- to mid-teens. The company’s ability to navigate the competitive landscape, particularly in delivery services, and its strategic initiatives, such as the introduction of new store concepts like K-Coffee and Fried Chicken Bro, further support its growth outlook. These factors contribute to the Buy rating, as they suggest a stable and promising investment opportunity with visible growth potential.
According to TipRanks, Luo is an analyst with an average return of -5.2% and a 44.44% success rate.
In another report released on November 5, Goldman Sachs also maintained a Buy rating on the stock with a HK$436.00 price target.