Return on Equity (ROE)
since 2005
Calculation
YUM! Brands Inc., ROE, long-term trends, calculation
| ROE | = | 100 | × | Net income, YUM! Brands, Inc.1 | ÷ | Shareholders’ equity (deficit), YUM! Brands, Inc.1 | |
|---|---|---|---|---|---|---|---|
| Dec 26, 2015 | 141.93% | = | 100 | × | 1,293) | ÷ | 911) |
| Dec 27, 2014 | 67.94% | = | 100 | × | 1,051) | ÷ | 1,547) |
| Dec 28, 2013 | 50.37% | = | 100 | × | 1,091) | ÷ | 2,166) |
| Dec 29, 2012 | 74.14% | = | 100 | × | 1,597) | ÷ | 2,154) |
| Dec 31, 2011 | 72.35% | = | 100 | × | 1,319) | ÷ | 1,823) |
| Dec 25, 2010 | 73.48% | = | 100 | × | 1,158) | ÷ | 1,576) |
| Dec 26, 2009 | 104.49% | = | 100 | × | 1,071) | ÷ | 1,025) |
| Dec 27, 2008 | — | = | 100 | × | 964) | ÷ | (108) |
| Dec 29, 2007 | 79.81% | = | 100 | × | 909) | ÷ | 1,139) |
| Dec 30, 2006 | 57.34% | = | 100 | × | 824) | ÷ | 1,437) |
| Dec 31, 2005 | 52.59% | = | 100 | × | 762) | ÷ | 1,449) |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-25), 10-K (reporting date: 2009-12-26), 10-K (reporting date: 2008-12-27), 10-K (reporting date: 2007-12-29), 10-K (reporting date: 2006-12-30), 10-K (reporting date: 2005-12-31).
1 US$ in millions
Analysis of the financial performance from 2005 to 2015 reveals a period of significant volatility in capital structure alongside a general upward trajectory in net earnings.
- Net Income Trends
- Net income exhibited a consistent growth pattern from 2005 through 2012, increasing from 762 million US dollars to a peak of 1,597 million US dollars. A subsequent contraction occurred in 2013 and 2014, where earnings decreased to 1,091 million and 1,051 million US dollars, respectively, before recovering to 1,293 million US dollars in 2015.
- Shareholders' Equity Dynamics
- The equity position experienced extreme fluctuations during the observed period. A critical deficit of 108 million US dollars was recorded in 2008, marking a transition into negative shareholders' equity. Following this, equity recovered strongly, peaking at 2,166 million US dollars in 2013. However, a sharp downward trend followed, with equity falling to 911 million US dollars by 2015, indicating a substantial reduction in the equity base.
- Return on Equity (ROE) Analysis
- ROE remained exceptionally high throughout the period, largely driven by the volatility of the equity base. The ratio rose from 52.59% in 2005 to 79.81% in 2007. Following the 2008 equity deficit—which rendered the ROE calculation inapplicable—the ratio spiked to 104.49% in 2009. After a period of relative stability between 72.35% and 74.14% from 2010 to 2012, ROE reached a maximum of 141.93% in 2015. This final peak is the result of a mathematical convergence between recovering net income and a significantly diminished equity denominator.
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Comparison to Competitors
YUM! Brands Inc., ROE, long-term trends, comparison to competitors
| YUM! Brands Inc. | Airbnb Inc. | Booking Holdings Inc. | Chipotle Mexican Grill Inc. | DoorDash, Inc. | McDonald’s Corp. | Starbucks Corp. | |
|---|---|---|---|---|---|---|---|
| Dec 26, 2015 | 141.93% | — | 29.01% | 22.35% | — | 63.90% | 47.39% |
| Dec 27, 2014 | 67.94% | — | 28.27% | 22.13% | — | 37.02% | 39.23% |
| Dec 28, 2013 | 50.37% | — | 27.39% | 21.29% | — | 34.89% | 0.19% |
| Dec 29, 2012 | 74.14% | — | 36.43% | 22.31% | — | 35.73% | 27.09% |
| Dec 31, 2011 | 72.35% | — | 41.04% | 20.58% | — | 38.24% | 28.41% |
| Dec 25, 2010 | 73.48% | — | 29.09% | 22.07% | — | 33.80% | 25.73% |
| Dec 26, 2009 | 104.49% | — | 37.04% | 18.03% | — | 32.43% | 12.83% |
| Dec 27, 2008 | — | — | 26.49% | 12.56% | — | 32.23% | 12.67% |
| Dec 29, 2007 | 79.81% | — | 27.12% | 12.55% | — | 15.67% | 29.45% |
| Dec 30, 2006 | 57.34% | — | 21.36% | 8.74% | — | 22.93% | 25.32% |
| Dec 31, 2005 | 52.59% | — | 52.22% | 12.19% | — | 17.18% | 23.65% |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-25), 10-K (reporting date: 2009-12-26), 10-K (reporting date: 2008-12-27), 10-K (reporting date: 2007-12-29), 10-K (reporting date: 2006-12-30), 10-K (reporting date: 2005-12-31).
Comparison to Sector (Consumer Services)
YUM! Brands Inc., ROE, long-term trends, comparison to sector (consumer services)
| YUM! Brands Inc. | Consumer Services | |
|---|---|---|
| Dec 26, 2015 | 141.93% | 43.28% |
| Dec 27, 2014 | 67.94% | 33.77% |
| Dec 28, 2013 | 50.37% | 27.00% |
| Dec 29, 2012 | 74.14% | 33.45% |
| Dec 31, 2011 | 72.35% | 35.81% |
| Dec 25, 2010 | 73.48% | 31.52% |
| Dec 26, 2009 | 104.49% | 29.09% |
| Dec 27, 2008 | — | 28.45% |
| Dec 29, 2007 | 79.81% | 17.62% |
| Dec 30, 2006 | 57.34% | 22.82% |
| Dec 31, 2005 | 52.59% | 18.57% |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-25), 10-K (reporting date: 2009-12-26), 10-K (reporting date: 2008-12-27), 10-K (reporting date: 2007-12-29), 10-K (reporting date: 2006-12-30), 10-K (reporting date: 2005-12-31).
Comparison to Industry (Consumer Discretionary)
YUM! Brands Inc., ROE, long-term trends, comparison to industry (consumer discretionary)
| YUM! Brands Inc. | Consumer Discretionary | |
|---|---|---|
| Dec 26, 2015 | 141.93% | 29.03% |
| Dec 27, 2014 | 67.94% | 20.60% |
| Dec 28, 2013 | 50.37% | 20.34% |
| Dec 29, 2012 | 74.14% | 21.97% |
| Dec 31, 2011 | 72.35% | 34.92% |
| Dec 25, 2010 | 73.48% | 24.34% |
| Dec 26, 2009 | 104.49% | 25.32% |
| Dec 27, 2008 | — | 1.64% |
| Dec 29, 2007 | 79.81% | 16.06% |
| Dec 30, 2006 | 57.34% | 3.84% |
| Dec 31, 2005 | 52.59% | 19.92% |
Based on: 10-K (reporting date: 2015-12-26), 10-K (reporting date: 2014-12-27), 10-K (reporting date: 2013-12-28), 10-K (reporting date: 2012-12-29), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-25), 10-K (reporting date: 2009-12-26), 10-K (reporting date: 2008-12-27), 10-K (reporting date: 2007-12-29), 10-K (reporting date: 2006-12-30), 10-K (reporting date: 2005-12-31).