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Yum! Brands Hikes Dividend by 6% After Robust Q4

Yum! Brands Inc. (YUM) operates over 50,000 restaurants in more than 150 countries and territories under the KFC, Pizza Hut and Taco Bell brands.

The company generated 40% of its revenue from KFC, 35% from Taco Bell, 17% from Pizza Hut and 8% from Habit Burger Grill during the quarter ended September 30, 2020. With restaurants spread around the world, the company provides shareholders with ample geographic diversification – even after its Yum China Holdings Inc. (YUMC) spin-off.

Better-Than-Expected Performance

The COVID-19 pandemic has had an adverse impact on many parts of the restaurant industry, but quick-service restaurants (QSR) fared better than the sit-down variety.

Yum! Brands reported a fourth-quarter revenue that rose three percent to $1.74 billion, which came in at $20 million ahead of consensus estimates. In addition, the company reported non-GAAP earnings of $1.15 per share, beating consensus estimates by 14 cents per share. The company added 227 new units during the quarter and 183 net new units during 2020.

The company raised its quarterly dividend by 6.4% to $0.50 per share, which represents a 1.9% forward yield, and is payable on March 12, 2021, to shareholders on record as of February 12, 2021.

In addition to its dividend, the company repurchased 2.4 million shares, totaling $250 million last quarter at an average price of $103 per share.

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