Yum China Holdings Inc. (YUMC): Technicals Say You should Hold

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Yum China Holdings Inc. (NYSE:YUMC) saw a downside of -1.99% to $60.59 after subtracting -$1.23 on Wednesday. The 5-day average trading volume is 1,500,543 shares of the company’s common stock. It has gained $62.05 in the past week and touched a new high 5 times within the past 5 days. An average of 1,748,816 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 2,080,284.

YUMC’s 1-month performance is 10.41% or $4.98 on its low of $54.35 reached on 12/30/22. The company’s shares have touched a 52-week low of $33.55 and high of $61.96, with the stock’s rally to the 52-week high happening on 01/25/23. YTD, YUMC has achieved 13.12% or $5.92 and has reached a new high 9 times. However, the current price is down -2.21% from the 52-week high price.

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Insider Transactions

YUMC stock investors last saw insider trading activity on Nov 15.Huang Johnson (Chief Customer Officer) most recently sold 6,317 shares at $55.00 per share on Nov 15. This transaction cost the insider $347,435. Chief People Officer, Yuen Aiken, sold 2,298 shares at a price of $52.80 on Nov 14. Then, on Nov 11, Chief Technology Officer Zhang Leila sold 1,176 shares at a price of $53.51 per share. This transaction amounted to $62,933.

Valuation Metrics

YUMC stock has a beta of 0.51. Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 2.61 while the price-to-book (PB) in the most recent quarter is 4.05, with the price to cash flow ratio at 54.55.

Yum China Holdings Inc.’s quick ratio for the recent period was 2.10, with the current ratio over the same period at 2.20. In terms of profitability, the gross margin trailing 12 months is 42.30%. The firm’s gross profit as reported stood at $2.12 billion against revenue of $9.85 billion.

Earnings Surprise

Yum China Holdings Inc.’s cash and short-term investments amounted to $2.83 billion against total debt of $1.9 billion. Net income and sales went up compared to those figures reported in the previous quarter. Net income grew 49.51% to $206.0 million, while revenue of $83.0 million was 59.71% off the previous quarter. EBITDA for the quarter stood at more than $466.0 million. YUMC stock balance sheet for the recent quarter shows that total liabilities totaled 4.54 billion, with total debt at $1.9 billion. Shareholders hold equity totaling $418.43 million.

Let’s look briefly at Yum China Holdings Inc. (YUMC) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 24 January was 60.36% to suggest the stock is trending Neutral, with historical volatility in this time period at 38.38%.

The stock’s 5-day moving average is $60.12, reflecting a +6.71% or $3.81 change from its current price. YUMC is currently trading +8.96% above its 20-day SMA, +20.87% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 by +18.76% and SMA200 by+45.01%.

Stochastic %K and %D was 90.00% and 85.44% and the average true range (ATR) pointed at 1.80. The RSI (14) points at 60.27%, while the 14-day stochastic is at 76.39% with the period’s ATR at 1.81. The stock’s 9-day MACD Oscillator is pointing at 1.68 and 1.89 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Yum China Holdings Inc. (NYSE: YUMC), Macquarie downgraded it to an Underperform rating. They previously had a Neutral rating on the stock. Analysts offering their rating for YUMC stock have a consensus rating for the stock as Overweight. Currently, 1 brokerage advisors rate YUMC as a “sell,”, while 2 advise that investors “Hold.” 0 analysts have rated the stock as underweight. 6 rates the stock as overweight while 16 have offered a “buy” rating.

What is YUMC’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $38.00 and a high of $77.00, with their median price target at $65.00. Looking at these predictions, the average price target given by analysts is for Yum China Holdings Inc. (YUMC) stock is $63.21.

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