UBS has reiterated its Buy rating on Yum! Brands (NYSE: YUM) and kept a $180.00 price target in place as the restaurant operator prepares to report fourth-quarter results on February 4. The stock was trading at $156.80, trading close to its 52-week high of $163.30, and the company has a market capitalization of $43.55 billion. According to InvestingPro data cited by analysts, Yum! has produced a 21.46% price return over the past year.
Outlook for the quarter and brands
UBS expects the company to preserve what it describes as a solid underlying growth trajectory, with several of Yum!'s core brands positioned to generate further momentum. The bank noted, however, that core operating income growth in the fourth quarter could fall slightly short of Yum!'s long-term algorithm of 8%+ growth. UBS attributes that potential shortfall in part to increased marketing investment at Pizza Hut during the quarter.
Within the portfolio, Taco Bell is projected to continue showing robust momentum. UBS models same-store sales growth for Taco Bell in the 6-7% range, above consensus estimates of 5.6%. KFC same-store sales are expected to be roughly 2%, which UBS indicates is consistent with consensus expectations.
2026 guidance and strategic priorities
Looking to 2026, UBS anticipates Yum! will guide to approximately 8% operating profit growth and unit growth in line with its 5% unit expansion algorithm. The bank warned that closures at Pizza Hut could pose a risk to reaching those targets.
UBS expects investor attention to concentrate on several items when the company reports: trends in sales at Taco Bell and KFC International, plans to turn around KFC in the U.S., the 2026 guidance the company issues, updates on the strategic review of Pizza Hut, and progress on the Byte by Yum! technology platform. UBS stated that Byte by Yum! could provide notable benefits over the coming years.
Dividend and corporate actions
Yum! declared a quarterly cash dividend of $0.71 per share, payable on December 12, 2025, to shareholders of record as of December 2, 2025. The company has paid dividends for 22 consecutive years and currently offers a dividend yield of 1.83%, according to InvestingPro data cited by UBS.
Yum! is also exploring strategic options for its Pizza Hut brand. Analysts are actively considering how different outcomes from that review could affect Yum!'s growth profile and valuation. In the market, TD Cowen recently upgraded Yum! from Hold to Buy, highlighting the potential that a sale of Pizza Hut could enhance the company’s growth prospects. UBS reiterated its Buy stance, emphasizing global growth potential for Taco Bell and KFC. By contrast, Stifel and Piper Sandler preserved Hold and Neutral ratings with price targets of $160.00 and $158.00, respectively; both firms are evaluating the implications of a possible Pizza Hut divestiture for Yum!'s valuation and earnings.
Implications for investors
As Yum! approaches its fourth-quarter disclosure, the market will be weighing a balance of expected brand-level growth against short-term pressure on operating income from elevated marketing spend at Pizza Hut and the uncertainty around strategic decisions for that chain. The company’s dividend track record and recent analyst activity underscore the level of investor interest in how Yum! navigates the Pizza Hut review while pursuing growth at Taco Bell and KFC.