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Earlier today, YUM! Brands announced quarterly adjusted earnings of $0.99 per share, which was ahead of the $0.97 cents analysts were looking for.The stock is up 4 per cent in after-hours trading.
U.S. comparable store sales were much stronger than expected, jumping 6 per cent year-over-year. Analysts surveyed by Bloomberg were looking for a 4.4 per cent gain.
Here’s a breakdown of those better-than-expected U.S. same-store sales:
- Taco Bell +7 per cent
- Pizza Hut +6 per cent
- KFC +4 per cent
That first bullet point should make Greenlight Capital’s David Einhorn happy.
At the Value Investing Congress on October 4, Einhorn recommended shorting Chipotle because he believed Taco Bell’s new upscale menu posed a major competitive threat.
We have yet to hear from Chipotle. However, it’s worth noting that Chipotle shares closed at $286 on Tuesday, which is down from the October 4 close of $294.
However, the strength of YUM!’s U.S. sales certainly isn’t a bad sign for Einhorn’s latest trade.
Management will hold a conference call Wednesday morning at 9:15 AM EST to discuss these results.