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The Best Options Trade for Yum! Brands (YUM) Earnings

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On Wednesday, October, 5th, Yum! Brands (YUM - Free Report) will release its quarter earnings results after the bell. The company is a Zacks Rank 3 (Hold), and they were upgraded within the last 30 days due to upward revisions in their earnings estimates.

Dave will investigate Yum! Brands past earnings, look at what is currently going on with the company, and give us his thoughts on their upcoming earnings announcement.

Furthermore, Dave will uncover some potential options trades for investors looking to make a play on Yum! Brands ahead of earnings.

Yum! Brands in Focus

Yum! Brands (YUM - Free Report) is the world's largest restaurant company in terms of system units with nearly 38,000 restaurants in over 120 countries and territories. Their brands - KFC, Pizza Hut and Taco Bell - are the global leaders of the chicken, pizza and Mexican-style food categories. The Yum! system includes four operating segments: U.S., International (Yum! Restaurants International), China and India Divisions.

Yum! Brands is expected to report earnings at $1.09 per share according to the Zacks Consensus Estimate. Last quarter they reported an earnings beat at $0.74 per share beating the Zack’s Consensus Estimate by a penny, and they have an average surprise of 3.08% over the last four quarters.

YUM! BRANDS INC Price, Consensus and EPS Surprise

YUM! BRANDS INC Price, Consensus and EPS Surprise | YUM! BRANDS INC Quote

Yum! Brands is trading around $90 a share, and they are near their 52-week high of $91.99 per share.

The Zacks Industry Rank classifies Yum! Brands in the retail-restaurants industry, and their industry is in the bottom 25%. Yum! Brands is in a difficult sector which is seeing major changes due to changing consumer demands and preferences. Yum! Brands include chains such as KFC and Taco Bell which don’t fit with many consumers who prefer healthier or fresh choices such as Chipotle Mexican Grill (CMG - Free Report) or Panera Bread . Meanwhile Yum! Brands fast food restaurants are going against stiff competition such as McDonald’s (MCD - Free Report) and Popeyes Kitchen . The tough competition and changing consumer demands is something Yum! Brands needs to keep an eye on moving forward.

Bottom Line

How should investors play Yum! Brands ahead of their earnings report? For insights on the best options trades, make sure to watch Dave Bartosiak at 1:00pm on Tuesday to see if he’ll be bullish, or bearish. If you are interested in Dave’s exclusive live streams and service, then sign up for Zacks Live Trader.

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