NEW YORK, NY / ACCESSWIRE / September 12, 2018 / Food related stocks GrubHub and Yum China Holdings were two of the most active stocks in the market on Tuesday. Despite any news, GrubHub soared to a brand new high. Shares of Yum China Holdings were in the red as traders reacted to a report that indicated there is no more buy out of the company.
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Yum China Holdings, Inc.
GrubHub Inc. shares were up a little over 4% at the close on Tuesday on about 1.4 million shares traded. The stock soared to a new high of $147.37 despite any news. It was in July that the company posted solid second quarter results pushing it to a record high then. The Chicago food delivery company saw $240 million in revenue for the second quarter, a jump of over 50% compared to the year ago quarter. It also saw an average of 423,000 orders a day and processed 1.2 billion in gross food sales. Founder and CEO Matthew M. Malone had said during the earnings call, "In the second quarter excluding impacts from acquisitions, more new diners tried Grubhub for the first time than any quarter before. And notably we accomplished this record new diner acquisition in a seasonally slower quarter, spending less money on advertising than we did in the first quarter. What we are most excited about is the great repeat behavior of these new diners, the best for second quarter diners in several years. Our second quarter results were strong and leading indicators for growth are robust. In short we are excited about our momentum and trajectory." He added, "To reinforce that trajectory, today we announced the proposed acquisition of LevelUp, the leader in mobile diner engagement and payment solutions for national and regional restaurant brands. LevelUp's world-class technology and team will expedite Grubhub's integrations with the nation's top restaurant brands, provide more tools to help them attract new diners and position us to accelerate order growth on the Grubhub platform."
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Yum China Holdings, Inc. shares were sinking on Tuesday, closing the day down 13.35% on a little over 16 million shares traded. The company, which operates Pizza Hut, KFC and Taco Bell in China, saw its shares tank after Bloomberg reported that a consortium of Chinese investors was walking away from its attempt to acquire the company. It was in July that investment firm Hillhouse was rumored to have made an offer to Yum China. It was late last month that the company rejected the first offer. According to Bloomberg News' Manuel Baigorri, many of Yum Brands China's restaurant operators are "suffering" from poor sales and the China-U.S. trade war certainly doesn't ease concerns. He thinks it isn't surprising that the deal is falling apart. He also projects that Yum China and the consortium of buyers are unlikely to return to the negotiating table to discuss a deal with a lower price. Shares of Yum China Holdings are down over 20% so far this year.
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