Yum China trades at a significant discount to analyst consensus with 24% upside potential and an attractive forward P/E of 13.6x, but geographic concentration entirely within China and a death-cross technical pattern create meaningful recovery risk.
Thesis pillars
- China Geographic Concentration Risk↓Deteriorating
- Deep Value Analyst Upside↓Deteriorating
- Earnings Consistency Inline→Stable
- +1 more pillar — see the Why tab for full reasoning
Yum China Holdings, Inc. (YUMC) Stock Analysis
Consumer Cyclical · Restaurants
Wait for pullback to $43.17. BUY gates pass at $47.14, but concentration risk — Geographic: China argues for a more patient entry. Engine's entry $43.17 (Atr Pullback Sticky) is the shallowest technical level that clears the 2:1 A.R:R minimum.
Yum China Holdings, the largest restaurant company in China by system sales, operates 18,101 KFC, Pizza Hut, Lavazza, Huang Ji Huang, Little Sheep, and Taco Bell restaurants across over 2,500 cities. The company generated $11.8 billion in revenues in 2025, with 83% of... Read more
Wait for pullback to $43.17. BUY gates pass at $47.14, but concentration risk — Geographic: China argues for a more patient entry. Engine's entry $43.17 (Atr Pullback Sticky) is the shallowest technical level that clears the 2:1 A.R:R minimum. Chart setup: No clear chart pattern; technical signals are mixed. Earnings in 0 days. Wait until post-earnings. Score 6.4/10, moderate confidence.
Passes 6/7 gates (positive momentum, favorable risk/reward ratio, clean insider activity, no SEC red flags, semi cycle peak clear, materials cycle peak clear). Fails on earnings proximity 0d<=7d. Suitability: moderate.
About Yum China Holdings, Inc.
About Yum China Holdings, Inc.
Yum China Holdings operated 18,101 restaurants across over 2,500 Chinese cities at December 31, 2025 — the largest restaurant company in China by system sales — generating $11.8 billion in revenues. KFC's 12,997 units led the portfolio alongside Pizza Hut's 4,168 locations, and delivery contributed approximately 48% of company sales. Digital ordering accounted for approximately 94% of total company sales, with combined KFC and Pizza Hut loyalty membership exceeding 590 million.
Yum China earns revenue from company-owned restaurant sales (roughly 83% of the network) and franchise royalties and fees from an approximately 17% franchised base. The franchise mix of net new stores rose from 30% in 2024 to 37% in 2025 for KFC and from 10% to 31% for Pizza Hut; the company targets 40% to 50% franchise mix of new store openings for both brands from 2026 to 2028. The company centrally purchases food and paper from over 850 independent suppliers, mostly China-based, and distributes through 34 logistics centers covering over 2,500 cities. Key raw materials — protein (poultry, pork, beef, seafood), cheese, oil, and flour — are subject to price volatility from trade policy shifts and weather events. Licensing rights for KFC, Pizza Hut, and Taco Bell flow from the master license agreement with Yum! Brands, which requires meeting a Sales Growth Metric over each rolling five-year period.
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Yum China's right to operate KFC, Pizza Hut, and Taco Bell in mainland China flows exclusively from its master license agreement with Yum! Brands. The 10-K discloses that at December 31, 2025, only 28 Taco Bell units existed against a contractual 2025 target of 225; Yum! Brands now has the right to end new Taco Bell sublicenses if renegotiation fails. Separately, PRC government controls on currency conversion and capital remittance could delay or restrict the transfer of profits offshore, compounding license risk with capital-access exposure inherent to any China-domiciled operating company.
See also: Consumer Cyclical · Restaurants
From Yum China Holdings, Inc.'s most recent 10-K filing, extracted June 16, 2026.
Recent developments
updated 2026-07-30Recent Developments — Yum China Holdings, Inc.
Latest news
- NEWS YUM, YUMC & BJRI: Which Restaurant Stock Will Shine in Q2 Earnings? - TradingView — TradingView neutral
- NEWS YUM, YUMC & BJRI: Which Restaurant Stock Will Shine in Q2 Earnings? - tradingview.com — tradingview.com neutral
- NEWS Yum China Holdings Inc (YUMC) Valuation: PE, PB & Fair Value Analysis - TradingKey — TradingKey neutral
- NEWS Yum China Holdings Inc (YUMC) Institutional Confidence - TradingKey — TradingKey neutral
- NEWS Royal Bank of Canada Decreases Position in Yum China $YUMC - MarketBeat — MarketBeat neutral
Generated 2026-07-31T01:58:51Z.
Upcoming dated catalysts
Thesis
Key Metrics
Quality Signals
Options Flow
Concentration Risks(10-K Item 1A)
- HIGHGeographicChina10-K Item 1A: 'We derive substantially all of our revenue from our operations in China'
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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Rating Breakdown
1 floor-breaker
Technicals below the gate floor. Component breakdown shows what dragged the score down.static
Price Targets
Position Sizing
Risk Alerts
Earnings
Verdict History
Frequently Asked Questions
Wait for pullback to $43.17. BUY gates pass at $47.14, but concentration risk — Geographic: China argues for a more patient entry. Engine's entry $43.17 (Atr Pullback Sticky) is the shallowest technical level that clears the 2:1 A.R:R minimum. Chart setup: No clear chart pattern; technical signals are mixed. Earnings in 0 days. Wait until post-earnings. Target $55.21 (+17.1%), stop $40.71 (−15.8%), A.R:R 1.8:1. Score 6.4/10, moderate confidence.
Take-profit target: $55.21 (+18.8% upside). Target $55.21 (+17.1%), stop $40.71 (−15.8%), A.R:R 1.8:1. Stop-loss: $40.71.
Concentration risk — Geographic: China.
Yum China Holdings, Inc. trades at a P/E of 17.6 (forward 14.0). TrendMatrix value score: 7.5/10. Verdict: Buy (Wait for Entry).
29 analysts cover YUMC with a consensus score of 4.2/5. Average price target: $61.
What does Yum China Holdings, Inc. do?Yum China Holdings, the largest restaurant company in China by system sales, operates 18,101 KFC, Pizza Hut, Lavazza,...
Yum China Holdings, the largest restaurant company in China by system sales, operates 18,101 KFC, Pizza Hut, Lavazza, Huang Ji Huang, Little Sheep, and Taco Bell restaurants across over 2,500 cities. The company generated $11.8 billion in revenues in 2025, with 83% of restaurants company-owned; digital ordering accounted for approximately 94% of total company sales. Loyalty membership combined across KFC and Pizza Hut exceeded 590 million members as of year-end 2025.