Yum! Brands Expected To Deliver Double-Digit YoY Decline In Earnings

Yum! Brands, Inc. YUM is scheduled to announce its second quarter financial results next Tuesday, after the market closes. And, according to Estimize, the company is expected to deliver a double-digit year-over-year decline in earnings.

In the second quarter of 2014, earnings came in at $0.73 per share, on revenue of $3.204 billion. For the current quarter, the Street is modeling consensus earnings of $0.63 per share (down 13.6 percent year-over-year) on sales of $3.177 billion.

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The crowd is more bullish, and anticipates consensus earnings of $0.67 per share on revenue of $3.203 billion.

The second chart here illustrates the evolution of sentiment over time. As it can be appreciated, both the Street and the crowd have been becoming more bearish on Yum’s earnings as the report date loomed.

Analyst Opinion

In an article published Friday, analysts at Zacks also preview Yum’s results. They warn that, after last year’s recent food safety scandal, it will be difficult for the company to post positive comps growth in China this quarter.

Nevertheless, the firm believes that Yun’s U.S. division is “poised to perform better in the to-be-reported quarter. Taco Bell’s menu innovations and the hugely popular breakfast platform should drive comps, while Pizza Hut’s comps will likely grow on the back of the massive makeover which took place in Nov 2014. KFC has also revamped its outlets in May, this year, and launched an improved online site, which would boost comps.”