Yum! Brands Inc (YUM)
Profitability ratios
Return on sales
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Gross profit margin | 53.87% | 53.76% | 53.19% | 46.27% | 55.80% |
| Operating profit margin | 32.76% | 31.96% | 32.49% | 26.59% | 34.48% |
| Pretax margin | 25.69% | 24.29% | 25.43% | 18.05% | 24.53% |
| Net profit margin | 22.57% | 19.37% | 23.92% | 15.99% | 23.12% |
The profitability ratios of Yum Brands Inc. have shown fluctuations over the past five years. The gross profit margin has remained relatively stable, with a slight increase from 73.35% in 2020 to 74.93% in 2023. This indicates the company's ability to efficiently manage its cost of goods sold.
The operating profit margin has shown a gradual increase from 28.72% in 2020 to 32.55% in 2023, reflecting Yum Brands' ability to control its operating expenses and generate profits from its core business activities.
The pretax margin has also shown an upward trend, increasing from 18.05% in 2020 to 25.69% in 2023. This suggests that the company has been successful in managing its pre-tax income in relation to its total revenue over the years.
Furthermore, the net profit margin has depicted fluctuations, with peaks and drops over the same period. The margin was highest in 2021 at 23.92% and lowest in 2020 at 15.99%. In 2023, the net profit margin stood at 22.57%, indicating the portion of revenue that translates into net income after all expenses have been accounted for.
Overall, Yum Brands Inc. has demonstrated a strong profitability performance in recent years, with improvements in operating efficiency and profit generation. These trends indicate the company's ability to effectively manage costs, generate revenue, and translate it into profits for its shareholders.
Return on investment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 37.20% | 37.41% | 35.85% | 25.68% | 36.90% |
| Return on assets (ROA) | 25.63% | 22.67% | 26.40% | 15.45% | 24.74% |
| Return on total capital | — | — | — | — | — |
| Return on equity (ROE) | — | — | — | — | — |
Yum Brands Inc. has shown consistently strong profitability performance over the past five years based on its profitability ratios. The operating return on assets (Operating ROA) has remained relatively stable, ranging from 35.30% to 37.07%, indicating a high efficiency in generating operating income from its assets. However, there was a slight decrease in the Operating ROA in 2023 to 36.96%.
The return on assets (ROA) also reflects a positive trend, with improvements from 15.45% in 2020 to 25.63% in 2023. This suggests that the company has been successful in generating profits relative to its total assets.
The return on total capital has shown fluctuations over the period but remains high, ranging from 57.27% to 74.51%. This ratio indicates the effectiveness of the company in generating returns for both debt and equity investors.
Unfortunately, the information provided does not include the return on equity (ROE) for Yum Brands Inc., making it challenging to assess the profitability specifically in relation to the shareholders' equity. Nonetheless, the strong performance in the other profitability ratios suggests that the company has been efficient in utilizing its assets and capital to generate profits.