P/E Ratio Overview: Yum Brands


27% profits every 20 days?

This is what Nic Chahine averages with his options buys. Not selling covered calls or spreads... BUYING options. Most traders don't even have a winning percentage of 27% buying options. He has an 83% win rate. Here's how he does it.


 

Looking into the current session, Yum Brands Inc. (NYSE:YUM) shares are trading at $94.25, after a 0.36% gain. Moreover, over the past month, the stock went up by 2.18%, but in the past year, decreased by 17.55%. Shareholders might be interested in knowing whether the stock is undervalued, even if the company is performing up to par in the current session.

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The stock is currently higher from its 52 week low by 71.52%. Assuming that all other factors are held constant, this could present itself as an opportunity for investors trying to diversify their portfolio with Hotels, Restaurants & Leisure stocks, and capitalize on the lower share price observed over the year.

The P/E ratio is used by long-term shareholders to assess the company’s market performance against aggregate market data, historical earnings, and the industry at large. A lower P/E indicates that shareholders do not expect the stock to perform better in the future, and that the company is probably undervalued. It shows that shareholders are less than willing to pay a high share price, because they do not expect the company to exhibit growth, in terms of future earnings.

Most often, an industry will prevail in a particular phase of a business cycle, than other industries.

Compared to the aggregate P/E ratio of the 40.68 in the Hotels, Restaurants & Leisure industry, Yum Brands Inc. has a lower P/E ratio of 28.19. Shareholders might be inclined to think that they might perform worse than its industry peers. It’s also possible that the stock is undervalued.

Price to earnings ratio is not always a great indicator of the company's performance. Depending on the earnings makeup of a company, investors may not be able to attain key insights from trailing earnings.


27% profits every 20 days?

This is what Nic Chahine averages with his options buys. Not selling covered calls or spreads... BUYING options. Most traders don't even have a winning percentage of 27% buying options. He has an 83% win rate. Here's how he does it.


Posted In: EarningsNewsIntraday UpdateMarketsP/E Ratio Insights