Yum! Brands Inc (YUM)
Profitability ratios
Return on sales
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Gross profit margin | 51.68% | 53.87% | 53.76% | 53.19% | 46.27% |
| Operating profit margin | 31.83% | 32.76% | 31.96% | 32.49% | 26.59% |
| Pretax margin | 25.17% | 25.69% | 24.29% | 25.43% | 18.05% |
| Net profit margin | 19.68% | 22.57% | 19.37% | 23.92% | 15.99% |
Yum! Brands Inc has shown a positive trend in its profitability ratios over the years.
- The Gross Profit Margin has increased from 46.27% in December 31, 2020 to 53.87% in December 31, 2023, indicating the company's ability to efficiently manage its production costs and generate more profit from its sales.
- The Operating Profit Margin has also shown improvement, rising from 26.59% in December 31, 2020 to 32.76% in December 31, 2023. This suggests that Yum! Brands Inc has been able to control its operating expenses effectively while increasing its operating income.
- The Pretax Margin has grown from 18.05% in December 31, 2020 to 25.69% in December 31, 2023. This indicates that the company's profitability before taxes has improved over the years.
- The Net Profit Margin has displayed a varying pattern, reaching its highest at 23.92% in December 31, 2021 but then declining slightly to 19.68% in December 31, 2024. This suggests that while the company has been successful in generating profits, there have been fluctuations in its bottom line profitability.
Overall, the upward trends in the Gross Profit Margin, Operating Profit Margin, and Pretax Margin indicate that Yum! Brands Inc has been successful in increasing its profitability and managing its costs efficiently. However, the fluctuation in the Net Profit Margin highlights the importance of consistently monitoring and managing all aspects of the business to ensure sustained profitability.
Return on investment
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | |
|---|---|---|---|---|---|
| Operating return on assets (Operating ROA) | 35.72% | 37.20% | 37.41% | 35.85% | 25.68% |
| Return on assets (ROA) | 22.09% | 25.63% | 22.67% | 26.40% | 15.45% |
| Return on total capital | — | — | — | — | — |
| Return on equity (ROE) | — | — | — | — | — |
Yum! Brands Inc has shown a consistent improvement in its Operating Return on Assets (Operating ROA) over the past five years, starting at 25.68% in December 2020 and reaching 35.72% by December 2024. This indicates that the company is effectively generating operating profits from its assets.
The Return on Assets (ROA) has also displayed a positive trend, with an increase from 15.45% in December 2020 to 22.09% in December 2024. ROA measures the company's ability to generate profits from its total assets, and the improvement suggests that Yum! Brands is becoming more efficient in utilizing its assets to generate earnings.
Unfortunately, data for Return on Total Capital and Return on Equity (ROE) is not available for the period under review, which limits the assessment of the company's performance in terms of profitability related to total capital employed or shareholders' equity during this timeframe.
Overall, the improving Operating ROA and ROA ratios of Yum! Brands Inc reflect positively on the company's profitability and efficiency in utilizing its assets to generate earnings over the specified years.