Yum! Brands, Inc. (YUM) Jumps On Big Earnings Beat

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Yum! Brands, Inc. (NYSE:YUM) revealed its earnings for the first three months of 2013 this afternoon after the market closed. The company revealed that it earned 70 cents per share in the period on revenue of $2.53 billion. In the after hours market shares were up more than 5 percent, having closed at $64.14 earlier on Tuesday, down a little over 1 percent.

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Analysts were expecting Yum! Brands, Inc. (NYSE:YUM) to announce earnings of 60 cents per share on revenue of $2.56 billion. The strong beat on earnings, coupled with the in line revenue restored investor confidence in the company after what had been a tough quarter. Not including today’s after market activity, the firm’s shares have fallen by more than 3 percent so far in 2013 in what was a booming stock market.

In the same quarter in 2012, the company announced earnings of 76 cents per share on revenues of $2.7 billion. The company’s business has been hurt in the last twelve months, but not as much as analysts had initially feared.

A great deal of the firm’s trouble stemmed from an issue it had with Chinese authorities over the ingredients it used in some of its fast food outlets in that country. Analysts feared that the distrust of Yum! Brands, Inc. (NYSE:YUM) outlets could result in a large rejection of those brands in the growing Chinese market.

China does not seem to have reacted as badly to the stories surrounding the company as had been feared according to these earnings results. Yum! Brands, Inc. (NYSE:YUM) might be able to continue to consolidate its growth in the country, having restored confidence in its business practices.

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