Yum! Brands Inc. (YUM) plans to sell two of its brands - Long John Silver's and A&W - so that it can focus on expanding the remaining three brands KFC, Pizza Hut and Taco Bell in the U.S, China and other international markets.

The fast-food giant recently reaffirmed its 14% EPS growth guidance for 2010 and expects earning per share growth of at least 10% in 2011. The upside is expected mostly to come from robust performances in its China division and new unit development in China and Yum Restaurants International (YRI). This will also mark the tenth consecutive year of the company's meeting or exceeding its annual EPS growth target of at least 10%.

Moreover, management's earnings growth model includes annual operating profit growth of at least 15% in the China Division attributable to its two leading brands, KFC and Pizza Hut, 10% in the YRI division and 6% in Taco Bell.

Yum! is also slated to open about 1,400 international units, mostly in China and YRI divisions, in fiscal 2011, which  will make it the industry's leading international new unit developer.

We believe that Yum! will definitely benefit from its increased focus on overseas expansion as it remains one of its key growth drivers  particularly with Yum!'s China division offering immense growth potential.