Investment Thesis
In the past twelve months, Yum China Holdings, Inc. (YUMC) has advanced ~38% amid rising revenue growth and margins, outperforming ~14% gain of its parent, YUM Brands, Inc. (YUM). The consistent growth in same-store sales has driven the revenue expansion despite a weakening Yuan, while menu innovations and strong purchasing power, driven by its scale, have lifted margins even through a period of rising inflation.
The improving comps of Pizza Hut, the focus on coffee, and a new acquisition should support the near-term revenue expansion, while softening inflation outlook is