By Mark Kalinowski
Published on January 23, 2019 at 12:00 AM
With this report, we update our data-driven Kalinowski Quick-Service Other Index for Q4E from +2.2% to +3.1%. This 90 basis-point increase is based on our latest proprietary checks/data as regards same-store sales performance for the second half of November and all of December.
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By Mark Kalinowski
Published on January 23, 2019 at 12:00 AM
Following the completion of our data-driven check process for Yum Brands (YUM; Buy), we raise our Q4E same-store sales projections for each of the company’s domestic brands. Our Q4E same-store sales forecast for Taco Bell rises by one percentage point to +5% (above sell-side consensus of +4%), and we would not rule out the possibility of an even better performance should a best-case scenario arise. Our Q4E same-store sales estimate for KFC U.S. goes up by one percentage point to +3% (above sell-side consensus of +2%), and our Q4E same-store sales projection for Pizza Hut U.S. goes up by one percentage point to +1% (now matching sell-side consensus). All of this has the effect of increasing our Q4E EPS estimate by $0.05 to $0.99, placing us two cents above sell-side consensus ahead of Yum Brands’ planned fourth-quarter earnings release scheduled for before the market open on Thursday, February 7th. Our full-year 2018E EPS estimate rises by $0.05 to $3.75. Given this higher base of anticipated earnings coming off of 2018, and assuming some momentum carries over, we also take up our 2019E and 2020E EPS estimates by $0.02 and $0.03, respectively, to $3.80 and $4.25. We reiterate our Buy rating on YUM, and note the following: * For the last 33 times there has been a published Kalinowski Forecast for Taco Bell, that forecast has been within 100 basis points of what Taco Bell reports 60.6% of the time (20 out of 33 times), and within 200 basis points of what Taco Bell reports 87.9% of the time (29 out of 33 times).
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By Mark Kalinowski
Published on January 22, 2019 at 12:00 AM
We briefly note the following tidbits regarding Taco Bell (owned by Yum Brands [YUM; Buy]), Domino’s (DPZ; Buy), and McDonald’s (MCD; Buy):
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