UPDATE: Citigroup Lowers PT on Yum! Brands Following Further Thoughts on 3Q13

In a report published Monday, Citigroup analyst Gregory R. Badishkanian reiterated a Neutral rating on

, but lowered the price target from $75.00 to $72.00. In the report, Citigroup noted, “Mgmt mentioned 4Q China SSS will be better than 3Q SSS, but not positive as they originally planned. The co mentioned softer than expected results from their beef burger launch impacted Sept SSS. Restaurant margin in FY13 should be in the mid teens, though 4Q margin will moderate 3pts vs. 3Q due to higher inflation (inflation was flat in 3Q, and modestly positive in 4Q and unrelated to supply chain changes made by YUM) and losing 1pt of pricing. Mgmt expects a bounce back in 2014 though mgmt believes it's challenging to predict SSS at this point. Expect CRM to be similar to '12 levels in '14, which implies at least 40% growth. The co expects to implement pricing to match the rate of inflation. Occupancy costs should be relatively stable, but labor inflation should increase (inflation of HSD for '13, but up low to mid DD in '14.).” Yum! Brands closed on Friday at $67.07.