Yum! Brands, Inc. (YUM) Stock Valuation — PE Analysis
Restaurants · NYSE
Current Price
$154.31
PE Ratio (TTM)
24.6x
Intrinsic Value
$212.47
+27.4% margin of safety
COMPETITIVE MOAT
↑Powerful Brand Portfolio
Yum! Brands owns iconic quick-service restaurant brands like KFC, Pizza Hut, and Taco Bell. These globally recognized names drive significant customer loyalty and demand.
↑Franchise Model Efficiency
The company's asset-light franchise model allows for rapid expansion and capital efficiency. This structure minimizes operational burdens and maximizes scalability across diverse markets.
↑Global Market Penetration
Yum! Brands has established a vast international presence, particularly in emerging markets. This diversification reduces reliance on any single economy and taps into high-growth regions.
INVESTMENT RISKS
↓Intense Industry Competition
The quick-service restaurant sector is highly competitive, with numerous players vying for consumer attention. This can pressure pricing and market share for Yum!'s brands.
↓Supply Chain Vulnerabilities
Disruptions in global supply chains can impact ingredient availability and costs for Yum!'s franchisees. This can lead to operational challenges and affect profitability.
↓Changing Consumer Preferences
Evolving consumer tastes and dietary trends can pose a challenge. Yum! must continuously innovate its menu and offerings to remain relevant and appealing.
Base case
YUM base case PE valuation
A base case PE valuation for YUM estimates a fair value of about $212.47 per share, against a current price of $154.31. The model assumes 12.9% annual earnings growth, a 25x target PE multiple, and a 10% discount rate.
Intrinsic Value
$212.47
Margin of safety
+27.4%
Expected annual return
+6.6%
Base case assumptions: 12.9% annual earnings growth, 25x target PE, 10% discount rate, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the YUM PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Yum! Brands, Inc. respond.
Open PE Calculator for YUMCompany Overview
YUM! Brands, Inc. (YUM) is a leading global quick-service restaurant enterprise that focuses on the creation, management, and franchising of its restaurant concepts internationally. Its business is organized into four main divisions: KFC, Taco Bell, Pizza Hut, and The Habit Burger Grill. The company operates establishments under these well-known brands, offering diverse food categories such as chicken, pizza, Mexican-style dishes, and made-to-order chargrilled burgers and sandwiches, among other food products. As of December 31, 2021, YUM! Brands boasted a significant worldwide presence, comprising 26,934 KFC outlets, 18,381 Pizza Hut locations, 7,791 Taco Bell restaurants, and 318 The Habit Burger Grill units, spread across roughly 157 countries and territories. The company, which maintains its headquarters in Louisville, Kentucky, was established in 1997. It was formerly known as TRICON Global Restaurants, Inc., before officially adopting the name YUM! Brands, Inc. in May 2002.
Financial Metrics — YUM PE Stock Valuation Data
PE Ratio (TTM)
24.6x
PEG Ratio
1.06
Earnings Yield
4.07%
ROE (TTM)
-23.3%
Revenue/Share (TTM)
$30.63
Dividend Yield
1.89%
Debt/Equity
n/m
Frequently Asked Questions
What is the PE ratio of YUM?
The trailing twelve-month PE ratio of YUM reflects how much investors pay per dollar of Yum! Brands, Inc.'s earnings. This metric is most useful when compared to Restaurants peers and the company's own historical range.
Is YUM overvalued based on PE ratio?
YUM's PE of 24.6x combined with a PEG ratio of 1.06 provides a growth-adjusted perspective. A PEG near 1.0 suggests the PE ratio is reasonably justified by the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Restaurants, a DCF analysis may be more appropriate.
How do I value YUM stock using PE ratio?
To value Yum! Brands, Inc. using PE: (1) Compare the current PE (24.6x) against the Restaurants median to assess relative pricing, (2) check the PEG ratio (1.06) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of YUM?
YUM's PEG ratio is 1.06, calculated by dividing the PE ratio (24.6x) by the expected earnings growth rate. A PEG near 1.0 suggests the stock is fairly priced relative to growth. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for YUM stock valuation?
PE ratio gives a quick relative read — how YUM is priced versus Restaurants peers. DCF provides an absolute value based on projected free cash flows. For the most reliable valuation, use PE as a quick comparability screen and DCF for a deeper fundamental analysis. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See YUM DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Consumer Cyclical valuationsP/E and DCF value YUM with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.