Grabbing a Bite in Burger Chain Stocks?: Yum! Brands, Inc. (YUM)

Conclusion

While McDonald’s is a safe stock, it also trades at a premium 17.8x multiple because of that. Wendy’s, which is moving into profitable territory, remains highly uncertain with a consensus rating of 2.9 out of 5 where “5” is a “sell.” I encourage considering Yum! Brands, Inc. (NYSE:YUM) which is the leading American fast food chain in China, for higher growth prospects. The stock trades at a respective 19.2x and 17.3x past and forward earnings. It is forecasted for 12.1% annual EPS growth over the next five years, which is around 300 bps below what was achieved in the past five years. And it’s not nearly as risky as some will make out–the stock’s volatility is 17% below that of the market.

The article Grabbing a Bite in Burger Chain Stocks? originally appeared on Fool.com and is written by David Gould.

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