Yum! Brands (YUM) P/E Chart

What is a PE Ratio?

The PE Ratio chart for Yum! Brands (YUM) is a valuation observation.

A PE Ratio is a price to earnings ratio that has historically helped investors define fair value. This is often referred to as the multiple of a stock, and when groups, markets, or sectors are defined the multiples of all the stocks in those groups can be averaged to define average PE multiples as well.

Average PE multiples have been popularized in recent years because historical comparisons make current valuations look stretched. Instead of comparing historical averages, investors today use peer groups to compare PE multiples for individual companies because those stocks often trade in the higher PE spectrum that exists in today’s environment.

However, the fact remains that a PE ratio reveals how much an investor is willing to pay for the earnings of a company at any given time. The higher the PE multiple the more expensive a company may be, but that is not always true. The PE ratio simply reveals how many times earnings an investor is willing to pay, or that a shareholder is willing to maintain. The PE Ratio alone does not reveal fair value.

Fair value is what someone is willing to pay, they say, and that is true, but in a time of free money and stimulus the willingness to pay more may also be skewed. Multiples can increase based on fabricated demand even if earnings growth does not warrant the higher valuation levels.

PE ratios still provide comps to peer groups, but they do not represent free market fair value anymore.

How is the Price to Earnings (PE) Ratio Calculated?

The PE Ratio = (Per Share Stock Price/EPS)

PUBLIC TRADING ACHIVES FOR YUM. (Real time data for subscribers only)

Yum Brands YUM Trading Signals

August 04, 2022

How the price action of Yum Brands (YUM) is used to our Advantage

July 26, 2022

Yum Brands YUM Proactive Strategies

July 12, 2022

Trading Yum Brands YUM With Integrated Risk Controls

July 03, 2022

Yum Brands YUM Trading Advice

June 23, 2022

Yum Brands YUM Investment Analysis

June 13, 2022

Yum Brands YUM Trading Report

June 02, 2022

When Yum Brands (YUM) Moves Investors should Listen

May 23, 2022

Yum Brands YUM Trading Advice

May 13, 2022

Learn to Evaluate Yum Brands (YUM) using the Charts

May 04, 2022

How To Trade Yum Brands YUM

April 24, 2022

Yum Brands (YUM) Trading Report

April 14, 2022

Yum Brands YUM Investment Analysis and Advice

April 04, 2022

Yum Brands YUM Trading Report

March 26, 2022

Yum Brands YUM Investment Report

March 16, 2022