Yum China Holdings Inc (YUMC)

Yum China Holdings Inc (YUMC) stock decreased by 7.52% due to concerns raised by analysts at UBS regarding potential downside risks to the company's first-quarter guidance. YUMC had previously provided guidance of relatively flat recurring operating profit for the first quarter ending March 31.

• UBS Analysis and Price Target: Despite maintaining a Buy rating on the stock, UBS raised its price target to $54 from $55 per share. The investment bank stated that it had a conversation with Yum China's management and adjusted its projections, now expecting a 13% net profit decline for the company. This adjustment was made considering a lower restaurant profit margin and lower general and administrative expense ratio.
• Market Performance and Competition: UBS noted that Yum China has underperformed MSCI China staples and discretionary indexes since the Chinese New Year, indicating that some "earnings downside risks have been partially factored in". The firm also observed increasing competition for Yum China's delivery business, adding to the concerns about the company's performance.
• Financial Reporting: Yum China is scheduled to report its financial results for the first quarter on Monday, April 29, after the close of the market. Investors and analysts will likely pay close attention to the company's performance and any updates or revisions to its guidance.

Yum China Holdings Stock (YUMC) dropped by 15.22% from $52.56 to $44.56 in the trading on Wednesday November 1, 2023. The reason why YUMC stock down today is due to weaker-than-expected third-quarter 2023 results. Quarterly revenue climbed 9% Y/Y to $2.91 billion. Adjusted net income of $248 million, or $0.59 per share, up 20% from $0.49 per share in the same year-ago period. Analysts, on average, were modeling adjusted earnings of $0.62 per share on revenue of $3.09 billion. The result is due to softening consumer demand from late September through October.