Yum! Brands Rallies After Strong Earnings

Yum! Brands just announced Q4 earnings of $US0.86 per share on revenue of $US4.18 billion.

Analysts were looking for adjusted Q4 earnings of $US0.79 per share, on revenue of $US4.25 billion.

The company reaffirmed guidance of at least 20% EPS growth in 2014.

Fourth quarter comp sales were down 4% in China, and down 4% in India.

Sales and profits in the China division were impacted by “the effects of the December 2012 poultry supply incident, as well as subsequent news of avian flu,” according to the earnings release.

Overall comp sales were down 2%, compared with expectations for a 1.6% rise.

The stock was up as much as 6.4% after hours to $US70.15.

Yum derives a large part of its revenue from China, so investors watch for clues on the health of the Chinese consumer.

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