Research
Research Alert: CFRA Maintains Hold Opinion On Shares Of Yum China Holdings Inc.
CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We revise our 12-month target price for Yum China to $52 (from $60), which implies a 2026 P/E of 18.2x (in line the three-year mean), reflecting our view that the company's forward-looking profile is fundamentally improving, and more predictable than in recent years. We welcome the strategic initiatives that turn Yum China into a more capital-efficient and shareholder-return-friendly company but remain concerned on long-term profitability expansion. We expect Yum China's revenue growth to be supported by continued store network expansion, particularly in underserved lower-tier cities, alongside product innovation and the rising adoption of food delivery, which accounted for about 51% and 55% of Pizza Hut and KFC sales, respectively, in Q1 2026. However, rising delivery costs and aggressive expansion into lower-tier cities will likely translate into a more moderate profit profile versus its existing tier 1 city strategy, in our opinion.
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