Yum Brands Inc. (NYSE: YUM) Director Robert Walters last week bought 35,000 shares of YUM common stock at an average price of $61.94 per share.
The purchase came a day after Yum Brands reported its quarterly results. The company’s fourth-quarter results were negatively impacted by China, where its sales at established restaurants dropped 6% due to adverse publicity regarding chemical residue found in some of the company’s chicken supply.
Same-store sales are expected to remain weak in China. In January, the company’s same-store sales tumbled 37%. The company forecasts a 25% drop in first-quarter same-store sales in China. Due to the weakness in China, Yum expects a “mid-single digit” percentage decline in earnings per share for 2013, compared to previous forecast of earnings per share growth of at least 10%.
For the fourth quarter of 2012, Yum Brands reported net income of $337 million, or $0.72 per share, compared to $356 million, or $0.75 per share reported for the same period in the previous year. Excluding one-time items, the company reported a profit of $0.83 per share for the fourth quarter, beating the consensus forecast of $0.82 per share.
The company’s total revenue for the fourth quarter was $4.15 billion, compared to $4.11 billion reported for the same period in the previous year.
Yum shares had fallen sharply after the company gave a disappointing outlook for 2013 due to weakness in China. The purchase of 35,000 shares from Walters, however, suggests that insiders are still confident about the company’s prospects.
On Tuesday, Yum shares rose marginally. The stock finished the day 0.31% higher at $64.75. Year-to-date, Yum shares are down nearly 2.5%.
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