NEW YORK (AP) -- Shares of Yum Brands Inc. declined before the market open on Tuesday as the restaurant operator reported mixed November sales results for China.
On Monday the company said that its China division recorded a 1 percent sales gain at restaurants open at least one year, including a rise of 7 percent at Pizza Hut. The metric climbed 16 percent for the first 10 days of November at KFCs while they offered a half-price bucket promotion. But the figure fell 8 percent for the rest of the month.
The sales measure is important in retailing because it excludes the effects of opening new locations or closing stores.
Paul Westra of Stifel Nicolaus said in a client note that the November performance was disappointing considering that the strong sales gain early in the month dropped off once the promotion ended.
But the analyst said Yum's stock still has compelling value. He maintained a "Buy" rating and $95 price target.
Raymond James' Brian Elliott said that the sales pattern displayed in China in November makes him more concerned about whether Yum can post same-store sales gains in the near term. The analyst reiterated a "Market Perform" rating.
Shares of Yum, which also operates Taco Bell, declined $2.21, or 2.8 percent, to $75.50 in premarket trading about 20 minutes ahead of the market opening.
- Investment & Company Information