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Yum! Brands, Inc. Message Board

  • oneworker oneworker Jun 17, 1998 12:07 AM Flag

    why do yum stocks drop when sales are up

    greetings! Just joined the internet. Glad to be
    i am a manager at a tricon restaurant. Love the
    greatest business in the world.

    i dont wish to
    appear naive,but can anyone explain to me
    why the
    stock has dipped below 30 ,even though sales
    pizza hut have reached a store average of over
    per week.


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    • ...for your opinion. I think that my fears are
      because I have seen some of these types of stocks go
      under. Consider BOST or SUBS. Boston Chicken has great
      food and a loyal customer base. But look at its stock
      price. Also, SUBS (Miami Subs). Have you ever been
      there? I first came across them in Miami. Then I saw one
      in New Jersey. They have a great line of food, and
      their prices are reasonable. But their stock is the
      pits. I know that I'm comparing Apples to Oranges in
      terms of size, but many fast food stock (for whatever
      reason) aren't really dynamic investments.

    • give them some time. this is only my opinio, they
      have some of the very best people in their top
      mangement positions. to get mr. pearson to head this new
      was a good move. he did a great job when he was
      involved with pep and frito now while the price is
      low, give them 3 to 5 years to get the problems worked took pep and frito lay time to get where they are
      today and they are still growing. GO PEP, GO FRITO LAY,
      GO YUM.

    • I have held the stock also and I have been put a
      few dollars in here or their. I do not believe that
      YUM's lack of growth is something unique to them. I
      also own Wendy shares and I have seen little growth
      their. I believe that there is just not too much growth
      in the entire fast-food sector right now. If you
      look at MCD you will find that stock has also been
      mostly yo-yoing for the past year or so in stock price.
      The lack of growth in fast-food sector was a
      contributing factor in Pepsico spinning off YUM in the first
      place. PEP felt (what is now) YUM was dragging down
      PEP's share price. So far that view seems to have been
      right on the money.
      Personally I am still planning
      to hold on to my YUM shares and add to it from
      time-to-time. If the company is able to expand its margins, as
      many experts think it can, this stock could easily
      double it stock value in the next two years based on
      this sector's average P/E. So far YUM has been
      struggling because the company has not been achieving this
      growth in margins for many on Wall Street.

    • Im a assistent store manager for them too. I
      don't think we sale that many a week but last Friday we
      sold over 1500 for the soccer jamboree. Luckily enough
      we also had one of our biggest days ever for the
      lunch buffett. My manager, Mr. Dolin said that he would
      recomend me for one of the new stores coming to our area
      (San Jose, CA) soon. Who needs technology hear in
      Silicon Valley wth sales like this. However I was
      surprised to see the stock go down Monday after our big
      weekend. Do you ever notice that after one of your big

    • First of all, welcome aboard! My answer to your
      question is that the stock market does not always act
      rationally. There are numerous factors that drive the market
      as a whole and stocks individually. Sales is one of
      many factors. A few of the others are: industry sector
      performance (restaurant stocks as a group), earnings, debt
      (YUM has a huge $4 billion debt load), psychology of
      individual investors and the market, and current market
      trends. See my recent post #387 about the trend. Also,
      don't forget that TriCon as an individual company is
      still less than a year old, even though TB, KFC, & PH
      have been around for years. How management grows sales
      and earnings while trimming debt will ultimately
      determine the direction of YUM's stock price. Just give it
      a chance.

    • Pl. let us know the percentage increase in
      Pizzahut sales over the last year.

      Another anamoly:
      YUM sales are about the same as MCD but market cap of
      YUM is about 1/9 th of MCD. What

      Methinks YUM will double in 2-3 years. What say

      60 in 2000.....

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