Yum! Brands to Resume Strong Growth After Transitory Taco Bell Pressures, UBS Says

MT Newswires Live08-01

Yum! Brands (YUM) is expected to resume its strong growth following temporary pressures from food safety issues at its Taco Bell business, UBS said in a note emailed Friday.

The fast-food company, which also operates KFC and Pizza Hut, posted strong Q2 results with the impact of food safety issue coming in better than feared, due to growth in same-store sales across key brands.

The invest firm forecasts that same-store sales improvement will continue through Q3, driven by menu innovation, promotional activity, increased online orders, and marketing as the company continues to expand Taco Bell into international markets such as India, the UK, and Canada.

Despite risks surrounding Taco Bell's recovery in the coming months, the brand is expected to be on track for sustained market share gains over time, according to the note.

UBS maintained its buy rating and price target of $180.

Price: 154.42, Change: -2.58, Percent Change: -1.64

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