YUM! Brands, Inc. YUM is scheduled to report its fourth-quarter 2022 results on Feb 8, before the opening bell. In the last reported quarter, the company’s bottom line missed the Zacks Consensus Estimate by 4.4%.
The Zacks Consensus Estimate for fourth-quarter earnings per share is pegged at $1.25, indicating a gain of 22.6% from the prior-year quarter's reported figure. The Zacks Consensus Estimate for revenues is pegged at $1.93 billion, suggesting growth of 2% from $1.89 billion in the prior-year quarter.
Factors to Note
Yum! Brands’ fourth-quarter 2022 performance is likely to have been aided by strong same-store sales growth, expansion efforts and strong off-premise ordering channels. Our estimate showcases an increase of 3.7% to $291.4 million in the Pizza Hut segment for the quarter under discussion. We expect Taco Bell revenues to increase 1.8% year over year to $696.1 million.
Yum! Brands, Inc. Price and EPS Surprise
Yum! Brands, Inc. price-eps-surprise | Yum! Brands, Inc. Quote
However, we expect KFC and Habit Burger revenues to decline 2.8% and 1.9% year over year to $772 million and $128.5 million, respectively.
Rising inflation levels are likely to have impacted margins in the to-be-reported quarter. An increase in the cost of employee wages, benefits and insurance, and other operating costs such as rent and energy costs, put significant pressure on the company’s margins.
What the Zacks Model Unveils
Our proven model predicts an earnings beat for Yum! Brands this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.
Earnings ESP: Yum! Brands has an Earnings ESP (difference between the Most Accurate Estimate and the Zacks Consensus Estimate) of +1.85%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: The company currently carries a Zacks Rank #2.
Other Stocks Poised to Beat Earnings Estimates
Here are some other stocks from the Zacks Retail-Wholesale sector that investors may consider, as our model shows that these too have the right combination of elements to post an earnings beat in the quarter to be reported:
Carrols Restaurant Group, Inc. TAST currently has an Earnings ESP of +39.54% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Carrols Restaurant Group have declined 18.6% in the past year. TAST has a trailing four-quarter earnings surprise of negative 110.8%, on average.
Yum China Holdings, Inc. YUMC currently has an Earnings ESP of +7.14% and a Zacks Rank #2.
Shares of Yum China have gained 29.2% in the past year. YUMC’s has a trailing four-quarter earnings surprise of 263.4%, on average.
Shake Shack Inc. SHAK has an Earnings ESP of +8.08% and a Zacks Rank #3.
Shares of Shake Shack have declined 14.5% in the past year. SHAK’s earnings beat the Zacks Consensus Estimate in each of the last four quarters. The company has a trailing four-quarter earnings surprise of 37.2%, on average.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report