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YUM · Analysis updated Nov 10, 2026, 6:00 PM ET
Why is Yum! Brands, Inc. (YUM) stock moving?
Yum! reported Q3 2026 results on Nov 3 with adjusted EPS of $1.56 and completed the Pizza Hut divestiture, returning $1.8B to shareholders year to date. GAAP EPS of $5.92 includes a roughly $1.7B pre-tax gain on the sale, so the adjusted figure is the better guide to underlying earnings. Core operating profit excluding Pizza Hut rose 1% in Q3 and 6% year to date, KFC unit count grew 7% with 955 gross new units, and KFC same-store sales were up 1%. Taco Bell remains the weak spot, with Q3 same-store sales down 4%, but management says it has outpaced the QSR industry on same-store sales since the end of September, and RBC describes the recovery as ahead of expectations. The stock rallied from about $150 in late October to a $166.31 close on Nov 4 on roughly 1.5 times average volume, with a high of $168.68 on Nov 5. It has since pulled back to $160.21 on Nov 10, still above the $156-157 zone that held during the Nov 2-3 pre-earnings trading. Analyst reaction was mostly constructive: Guggenheim, TD Cowen and RBC lifted targets to $180, Redburn to $188, and Deutsche Bank and Citi to $171, while BMO trimmed to $170 and BTIG and RBC keep neutral-leaning ratings. Risks include McDonald's push into chicken in Japan, Taco Bell's unfinished turnaround, and the fact that the rally has already priced in much of the recovery.
News behind the analysis
- Yum! Brands Reports Third-Quarter 2026 Financial ResultsAdjusted EPS was $1.56 and the Pizza Hut divestiture was completed, with $1.8B returned to shareholders year to date. KFC unit count rose 7% and Taco Bell U.S. has outpaced the QSR industry on same-store sales since the end of September.
- Yum! Brands Earnings Beat Masks Taco Bell Weakness, but CEO Sees Recovery Taking HoldYum! beat Q3 EPS estimates but narrowly missed revenue, with KFC growth offsetting Taco Bell weakness. Pizza Hut divestitures closed during the quarter.
- Yum! Brands' Taco Bell Recovery Outpaces ExpectationsTaco Bell sales have returned to growth following an earlier food safety-related hit, according to RBC's read of the results.
- BMO Capital Adjusts Price Target on Yum! Brands to $170 From $175BMO trimmed its price target by $5 after the quarter, one of the few target cuts among recent analyst updates.
- Citigroup Maintains Neutral on Yum Brands, Raises Price Target to $171Citigroup kept a Neutral rating while raising its price target to $171 following the results.
- Deutsche Bank Adjusts Price Target on Yum! Brands to $171 From $167Deutsche Bank raised its price target by $4 to $171 after the third-quarter report.
- 'McDonald's wages war on KFC in Japan as consumers crave chicken' - Nikkei AsiaNikkei reports that McDonald's is competing directly with KFC in Japan as demand for chicken rises, a competitive risk for KFC's international business.
- Guggenheim Maintains Yum! Brands at Buy, Raises Price Target to $180Guggenheim kept its Buy rating and raised its price target from $155 to $180, the largest move among the recent updates.
- Rothschild & Co Redburn Adjusts Yum! Brands Price TargetRothschild & Co Redburn raised its price target from $175 to $188, the highest target among the recent updates.
- KFC Renews Beverage Supply Contract with PepsiCo in Key International MarketsKFC renewed its beverage supply partnership with PepsiCo across several international markets, including the U.K., Australia and India.
About Yum! Brands, Inc.
Yum! Brands is a Louisville-based restaurant company that franchises KFC and Taco Bell, plus the smaller Habit Burger & Grill, across more than 100 countries. It sold Pizza Hut in 2026: the mainland China business went to Yum China and the rest to LongRange Capital, both deals closing in Q3. Roughly 97% of its restaurants are run by franchisees.
How it makes money
Most of its revenue, roughly 64% by Morningstar's estimate, comes from franchisees: royalties on their sales, fees and contributions to the marketing fund. The rest comes from sales at restaurants the company owns itself, mostly Taco Bell locations in the US. It also earns a licence fee of about 3% of system sales from Yum China, which runs KFC and Taco Bell in mainland China.
What usually moves YUM
- Taco Bell US same-store sales and food-safety incidents
- KFC international unit growth and sales
- Pace of new restaurant openings
- US consumer spending and value-menu competition
- Currency swings and leverage/interest costs