Yum Brands Tumbles on Chinese Guidance
Yum Brands (NASDAQ: YUM) traded down after reporting earnings Monday afternoon. Shares fell more than 4 percent in after-hours trading.
Yum Brands reported fourth quarter earnings per shares of $0.83, more than a $0.82 estimate, on revenue of $4.15 billion -- greater than the $4.12 billion that was expected.
What hurt Yum was its guidance, particularly in relation to China: Yum said its same-store Chinese sales dropped 6%. The company, through its KFC stores, has significant exposure to mainland China.
The company blamed its poor Chinese KFC sales on a probe from the Shanghai FDA. Yum said the publicity from the Chinese government's actions could have significant negative effects on its sales in China. Overall, the company said it doesn't expect to grow earnings per share this year.
Shares of Yum Brands closed on Monday at $63.94. In after-hours trading, shares look to be around $61.
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