Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.
Operating Margin30.8%
Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.
Net Income Margin19.0%
Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.
Financial Health
D
Years to Pay Off Debt8.5 yrs
Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.
Working Capital vs Long-Term Debt-$11.2B
Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.
Working Capital$524M
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Valuation
N/A
Cash Flow
B
Free Cash Flow$1.6B
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
CapEx % of Net Income23.8%
Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.
Owner Earnings$2.1B
Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.
Metric Explanations
What each dimension measures and where the thresholds come from.
Gross Profit Margin
Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.
Operating Margin
Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.
Net Income Margin
Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.
Years to Pay Off Debt
Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.
Working Capital vs Long-Term Debt
Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.
Working Capital
Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.
Free Cash Flow
Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.
CapEx % of Net Income
Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.
Owner Earnings
Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.
Market Data
Key Margins
Gross Profit46.2%
Operating Margin30.8%
Net Margin19.0%
Company Info
Showing Key Metrics
Income Highlights
Metric
2025
2024
2023
2022
2021
Gross Profit %
46.2%▼
47.5%▼
49.4%▲
48.3%•
N/A
Operating Margin %
30.8%▼
31.8%▼
32.5%▲
31.7%•
N/A
Net Income %
19.0%▼
19.7%▼
22.6%▲
19.4%•
N/A
Diluted EPS
5.55▲
5.22▼
5.59▲
4.57•
N/A
Balance Sheet Highlights
Metric
2025
2024
2023
2022
2021
Total Assets
$8.2B
$6.7B
$6.2B
$5.8B
N/A
Total Debt
$13.2B▲
$12.3B▲
$12.0B▼
$12.7B•
N/A
Working Capital
$524M▼
$602M▲
$332M▲
-$56M•
N/A
Years to Pay Debt
8.46
8.27
7.53
9.56
N/A
Cash Flow Highlights
Metric
2025
2024
2023
2022
2021
Free Cash Flow
$1.6B▲
$1.4B▲
$1.3B▲
$1.1B•
N/A
Owner Earnings
$2.1B
$1.9B
$2.0B
$1.8B
N/A
CapEx % of Net Income
23.8%
17.3%
17.8%
21.1%
N/A
Income Statement
2025
2024
2023
2022
2021
Tax Effect Of Unusual Items
9,477
-1,307
2,299
7,917
Tax Rate For Calcs
0
0
0
0
Normalized EBITDA
2,746,000
2,570,000
2,465,000
2,296,000
Total Unusual Items
38,000
-6,000
19,000
39,000
Total Unusual Items Excluding Goodwill
38,000
-6,000
19,000
39,000
Net Income From Continuing Operation Net Minority Interest
1,559,000
1,486,000
1,597,000
1,325,000
Reconciled Depreciation
206,000
175,000
153,000
146,000
Reconciled Cost Of Revenue
4,422,000
3,965,000
3,580,000
3,535,000
EBITDA
2,784,000
2,564,000
2,484,000
2,335,000
EBIT
2,578,000
2,389,000
2,331,000
2,189,000
Net Interest Income
-501,000
-489,000
-513,000
-527,000
Interest Expense
501,000
489,000
513,000
527,000
Normalized Income
1,530,477
1,490,693
1,580,299
1,293,917
Net Income From Continuing And Discontinued Operation
1,559,000
1,486,000
1,597,000
1,325,000
Total Expenses
5,684,000
5,146,000
4,773,000
4,675,000
Total Operating Income As Reported
2,574,000
2,403,000
2,318,000
2,187,000
Diluted Average Shares
281,000
285,000
285,000
290,000
Basic Average Shares
279,000
282,000
281,000
286,000
Diluted EPS
0
0
0
0
Basic EPS
0
0
0
0
Diluted NI Availto Com Stockholders
1,559,000
1,486,000
1,597,000
1,325,000
Net Income Common Stockholders
1,559,000
1,486,000
1,597,000
1,325,000
Net Income
1,559,000
1,486,000
1,597,000
1,325,000
Net Income Including Noncontrolling Interests
1,559,000
1,486,000
1,597,000
1,325,000
Net Income Continuous Operations
1,559,000
1,486,000
1,597,000
1,325,000
Tax Provision
518,000
414,000
221,000
337,000
Pretax Income
2,077,000
1,900,000
1,818,000
1,662,000
Other Income Expense
49,000
-14,000
28,000
22,000
Other Non Operating Income Expenses
11,000
-8,000
9,000
-17,000
Special Income Charges
32,000
21,000
17,000
19,000
Other Special Charges
-27,000
-35,000
Write Off
16,000
13,000
12,000
8,000
Impairment Of Capital Assets
16,000
Restructuring And Mergern Acquisition
-48,000
-34,000
-29,000
-27,000
Gain On Sale Of Security
6,000
-27,000
2,000
20,000
Net Non Operating Interest Income Expense
-501,000
-489,000
-513,000
-527,000
Interest Expense Non Operating
501,000
489,000
513,000
527,000
Operating Income
2,530,000
2,403,000
2,303,000
2,167,000
Operating Expense
1,262,000
1,181,000
1,193,000
1,140,000
Selling General And Administration
1,262,000
1,181,000
1,193,000
1,140,000
General And Administrative Expense
1,262,000
1,181,000
1,193,000
1,140,000
Other Gand A
1,262,000
1,181,000
1,193,000
1,140,000
Salaries And Wages
-6,000
9,000
7,000
Gross Profit
3,792,000
3,584,000
3,496,000
3,307,000
Cost Of Revenue
4,422,000
3,965,000
3,580,000
3,535,000
Total Revenue
8,214,000
7,549,000
7,076,000
6,842,000
Operating Revenue
8,214,000
7,549,000
7,076,000
6,842,000
Balance Sheet
2025
2024
2023
2022
2021
Ordinary Shares Number
276,569
279,072
281,000
280,000
Share Issued
276,569
279,072
281,000
280,000
Net Debt
11,053,000
10,650,000
10,633,000
11,427,000
Total Debt
13,189,000
12,286,000
12,031,000
12,661,000
Tangible Book Value
-9,203,000
-8,800,000
-8,877,000
-9,868,000
Invested Capital
4,437,000
3,618,000
3,287,000
2,918,000
Working Capital
524,000
602,000
332,000
-56,000
Net Tangible Assets
-9,203,000
-8,800,000
-8,877,000
-9,868,000
Capital Lease Obligations
1,427,000
1,020,000
886,000
867,000
Common Stock Equity
-7,325,000
-7,648,000
-7,858,000
-8,876,000
Total Capitalization
4,410,000
3,599,000
3,242,000
2,528,000
Total Equity Gross Minority Interest
-7,325,000
-7,648,000
-7,858,000
-8,876,000
Stockholders Equity
-7,325,000
-7,648,000
-7,858,000
-8,876,000
Gains Losses Not Affecting Retained Earnings
-311,000
-392,000
-302,000
-369,000
Other Equity Adjustments
-311,000
-392,000
-302,000
-369,000
Retained Earnings
-7,014,000
-7,256,000
-7,616,000
-8,507,000
Capital Stock
0
0
60,000
0
Common Stock
0
0
60,000
0
Total Liabilities Net Minority Interest
15,522,000
14,375,000
14,089,000
14,722,000
Total Non Current Liabilities Net Minority Interest
14,006,000
13,106,000
12,812,000
13,057,000
Other Non Current Liabilities
960,000
938,000
913,000
873,000
Long Term Debt And Capital Lease Obligation
13,046,000
12,168,000
11,899,000
12,184,000
Long Term Capital Lease Obligation
1,311,000
921,000
799,000
780,000
Long Term Debt
11,735,000
11,247,000
11,100,000
11,404,000
Current Liabilities
1,516,000
1,269,000
1,277,000
1,665,000
Other Current Liabilities
531,000
419,000
373,000
425,000
Current Debt And Capital Lease Obligation
143,000
118,000
132,000
477,000
Current Capital Lease Obligation
116,000
99,000
87,000
87,000
Current Debt
27,000
19,000
45,000
390,000
Other Current Borrowings
27,000
19,000
45,000
390,000
Pensionand Other Post Retirement Benefit Plans Current
285,000
242,000
258,000
246,000
Payables And Accrued Expenses
557,000
490,000
514,000
517,000
Current Accrued Expenses
219,000
210,000
228,000
258,000
Interest Payable
86,000
84,000
82,000
83,000
Payables
338,000
280,000
286,000
259,000
Total Tax Payable
46,000
31,000
55,000
16,000
Income Tax Payable
46,000
31,000
55,000
16,000
Accounts Payable
292,000
249,000
231,000
243,000
Total Assets
8,197,000
6,727,000
6,231,000
5,846,000
Total Non Current Assets
6,156,000
4,856,000
4,622,000
4,237,000
Other Non Current Assets
495,000
448,000
473,000
466,000
Non Current Deferred Assets
965,000
1,071,000
1,045,000
750,000
Non Current Deferred Taxes Assets
965,000
1,071,000
1,045,000
750,000
Investments And Advances
0
124,000
116,000
118,000
Long Term Equity Investment
0
124,000
116,000
118,000
Investments In Other Ventures Under Equity Method
0
124,000
116,000
118,000
Investmentsin Subsidiariesat Cost
118,000
Goodwill And Other Intangible Assets
1,878,000
1,152,000
1,019,000
992,000
Other Intangible Assets
909,000
416,000
377,000
354,000
Goodwill
969,000
736,000
642,000
638,000
Net PPE
2,818,000
2,185,000
1,961,000
1,913,000
Accumulated Depreciation
-1,485,000
-1,384,000
-1,332,000
-1,283,000
Gross PPE
4,303,000
3,569,000
3,293,000
3,196,000
Other Properties
1,213,000
881,000
764,000
742,000
Machinery Furniture Equipment
924,000
714,000
676,000
651,000
Buildings And Improvements
1,785,000
1,591,000
1,480,000
1,427,000
Land And Improvements
381,000
383,000
373,000
376,000
Current Assets
2,040,000
1,871,000
1,609,000
1,609,000
Other Current Assets
64,000
58,000
159,000
152,000
Assets Held For Sale Current
1,000
21,000
4,000
190,000
Restricted Cash
192,000
155,000
177,000
220,000
Prepaid Assets
119,000
100,000
152,000
138,000
Receivables
955,000
830,000
757,000
680,000
Taxes Receivable
114,000
55,000
20,000
32,000
Accounts Receivable
841,000
775,000
737,000
648,000
Allowance For Doubtful Accounts Receivable
-60,000
-74,000
-39,000
-37,000
Gross Accounts Receivable
901,000
849,000
776,000
685,000
Cash Cash Equivalents And Short Term Investments
709,000
707,000
512,000
367,000
Other Short Term Investments
0
91,000
0
Cash And Cash Equivalents
709,000
616,000
512,000
367,000
Cash Flow
2025
2024
2023
2022
2021
Free Cash Flow
1,639,000
1,432,000
1,318,000
1,148,000
Repurchase Of Capital Stock
-552,000
-441,000
-50,000
-1,200,000
Repayment Of Debt
-1,102,000
-479,000
-676,000
-699,000
Issuance Of Debt
1,582,000
582,000
0
999,000
Capital Expenditure
-371,000
-257,000
-285,000
-279,000
Interest Paid Supplemental Data
516,000
510,000
526,000
486,000
Income Tax Paid Supplemental Data
405,000
494,000
432,000
371,000
End Cash Position
923,000
807,000
724,000
647,000
Beginning Cash Position
807,000
724,000
647,000
771,000
Effect Of Exchange Rate Changes
32,000
-21,000
10,000
-26,000
Changes In Cash
84,000
104,000
67,000
-98,000
Financing Cash Flow
-924,000
-1,163,000
-1,429,000
-1,323,000
Cash Flow From Continuing Financing Activities
-924,000
-1,163,000
-1,429,000
-1,323,000
Net Other Financing Charges
-63,000
-73,000
-25,000
-53,000
Cash Dividends Paid
-789,000
-752,000
-678,000
-649,000
Common Stock Dividend Paid
-789,000
-752,000
-678,000
-649,000
Net Common Stock Issuance
-552,000
-441,000
-50,000
-1,200,000
Common Stock Payments
-552,000
-441,000
-50,000
-1,200,000
Net Issuance Payments Of Debt
480,000
103,000
-676,000
579,000
Net Short Term Debt Issuance
-47,000
345,000
-279,000
279,000
Short Term Debt Payments
-136,000
0
-279,000
0
Short Term Debt Issuance
89,000
345,000
0
279,000
Net Long Term Debt Issuance
527,000
-242,000
-397,000
300,000
Long Term Debt Payments
-966,000
-479,000
-397,000
-699,000
Long Term Debt Issuance
1,493,000
237,000
0
999,000
Investing Cash Flow
-1,003,000
-422,000
-107,000
-202,000
Cash Flow From Continuing Investing Activities
-1,003,000
-422,000
-107,000
-202,000
Net Other Investing Changes
-19,000
-19,000
-3,000
4,000
Net Investment Purchase And Sale
91,000
-91,000
0
0
Net Business Purchase And Sale
-704,000
-55,000
181,000
73,000
Sale Of Business
78,000
153,000
181,000
73,000
Purchase Of Business
-782,000
-208,000
0
0
Capital Expenditure Reported
-371,000
-257,000
-285,000
-279,000
Operating Cash Flow
2,010,000
1,689,000
1,603,000
1,427,000
Cash Flow From Continuing Operating Activities
2,010,000
1,689,000
1,603,000
1,427,000
Change In Working Capital
-17,000
-86,000
-91,000
-105,000
Change In Payables And Accrued Expense
46,000
-21,000
13,000
-22,000
Change In Payable
46,000
-21,000
13,000
-22,000
Change In Account Payable
94,000
8,000
-30,000
-39,000
Change In Tax Payable
-48,000
-29,000
43,000
17,000
Change In Income Tax Payable
-48,000
-29,000
43,000
17,000
Change In Prepaid Assets
-18,000
-12,000
-15,000
1,000
Change In Receivables
-45,000
-53,000
-89,000
-84,000
Other Non Cash Items
112,000
76,000
162,000
60,000
Stock Based Compensation
70,000
69,000
95,000
84,000
Asset Impairment Charge
22,000
12,000
13,000
10,000
Deferred Tax
107,000
-30,000
-290,000
-55,000
Deferred Income Tax
107,000
-30,000
-290,000
-55,000
Depreciation Amortization Depletion
206,000
175,000
153,000
146,000
Depreciation And Amortization
206,000
175,000
153,000
146,000
Operating Gains Losses
-49,000
-13,000
-36,000
-38,000
Gain Loss On Investment Securities
-86,000
Gain Loss On Sale Of Business
-48,000
-34,000
-29,000
-27,000
Net Income From Continuing Operations
1,559,000
1,486,000
1,597,000
1,325,000
2/5
Graham Score
Speculative Investor
Fails most of Graham's safety criteria. Treat with caution.
Graham's Fair Value
N/A
Negative book value — Graham's formula requires positive equity (BVPS). Common in companies with heavy buybacks (MCD, AAPL). Not a flaw in the business, but the formula cannot produce a fair value.
Margin of Safety
—
Market Cap / Net Assets
⚠ Negative Net Assets
Net Assets: -$7.3B
⚠ Negative Net Assets — total liabilities exceed total assets on paper. This is common in companies that aggressively return capital via buybacks and dividends (Apple, McDonald's, Domino's). It does not indicate insolvency if the business generates strong, consistent free cash flow. Focus on FCF and earnings power rather than balance sheet book value for these companies.
Warren's Owner Earnings
$2.1B
Latest fiscal year
Graham's 7 Criteria
Defensive Investor Checklist
2/5 — Speculative Investor
✅
Adequate Size
Graham required companies large enough to withstand economic downturns. This threshold ($1.5B) is inflation-adjusted from Graham's original $100M — virtually all S&P 500 companies pass this today.
$8.2B
vs > $1.5B revenue
❌
Strong Financial Condition
Current assets must be at least twice current liabilities. Note: highly profitable companies (Apple, Domino's) often run negative or low working capital deliberately — they collect cash fast and stretch payables. A failing score here is not always a warning sign.
1.35x
vs Current Ratio > 2.0x
✅
Earnings Stability
Graham required uninterrupted positive earnings. Any loss year is a red flag for defensive investors. Growth companies and cyclicals may show occasional losses during investment cycles or downturns without being fundamentally unsound.
No loss years (4 yrs data)
vs No negative EPS years
❌
Dividend Record
Graham valued dividends as evidence of financial discipline and shareholder alignment. Many excellent modern businesses (Alphabet, Amazon, Berkshire Hathaway) pay no dividend, preferring to reinvest cash at high rates of return. Failing this criterion does not indicate a poor business — it may indicate a high-growth one.
No dividend
vs Uninterrupted dividends
❌
Earnings Growth
EPS grew from $4.57 to $5.55 over 3 years. Graham's 33% threshold was set over a 10-year period. Measured over fewer years (as here), the bar is proportionally lower. Share buybacks can also inflate EPS growth without reflecting underlying business improvement.
+21.4% EPS growth
vs > 33% EPS growth
Graham's 7 Criteria — Explained
What each criterion measures and why it matters.
✅ Adequate Size — $8.2Bvs > $1.5B revenue
Graham required companies large enough to withstand economic downturns. This threshold ($1.5B) is inflation-adjusted from Graham's original $100M — virtually all S&P 500 companies pass this today.
"The minimum size of an enterprise should be not less than $100 million of annual sales."
❌ Strong Financial Condition — 1.35xvs Current Ratio > 2.0x
Current assets must be at least twice current liabilities. Note: highly profitable companies (Apple, Domino's) often run negative or low working capital deliberately — they collect cash fast and stretch payables. A failing score here is not always a warning sign.
"For industrial companies, current assets should be at least twice current liabilities."
✅ Earnings Stability — No loss years (4 yrs data)vs No negative EPS years
Graham required uninterrupted positive earnings. Any loss year is a red flag for defensive investors. Growth companies and cyclicals may show occasional losses during investment cycles or downturns without being fundamentally unsound.
"The company should have shown no deficit in the past ten years."
❌ Dividend Record — No dividendvs Uninterrupted dividends
Graham valued dividends as evidence of financial discipline and shareholder alignment. Many excellent modern businesses (Alphabet, Amazon, Berkshire Hathaway) pay no dividend, preferring to reinvest cash at high rates of return. Failing this criterion does not indicate a poor business — it may indicate a high-growth one.
"Some current dividend payments — for at least the past 20 years."
EPS grew from $4.57 to $5.55 over 3 years. Graham's 33% threshold was set over a 10-year period. Measured over fewer years (as here), the bar is proportionally lower. Share buybacks can also inflate EPS growth without reflecting underlying business improvement.
"A minimum increase of at least one-third in per-share earnings over ten years."
These metrics estimate what YUM is worth based on fundamentals — independent of what the market prices it at.
Graham's Fair Value and NCAV are conservative floors.
EPV assumes zero growth. These are reference points, not price targets.
Net Current Asset Value
N/A
"Buy at two-thirds of net current assets." — Graham
Earnings Power Value
N/A
Per share, no-growth floor. Compare to current price.
ROIC — Return on Invested Capital
29.9%
Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.
Cash Flow Analysis
Metric
2025
2024
2023
2022
2021
Capital Expenditure % of Net Income
23.8%
17.3%
17.8%
21.1%
N/A
Repurchase of Capital Stock
-$552M
-$441M
-$50M
-$1.2B
N/A
Free Cash Flow
$1.6B▲
$1.4B▲
$1.3B▲
$1.1B•
N/A•
Warren's Owner Earnings
$2.1B
$1.9B
$2.0B
$1.8B
N/A
Peers & Industry
No auto-detected peers for this industry. You can manually compare YUM against any stock using the Compare tool.
"The management of a business is its most important single factor — more important than market position, patents, or financial structure."
— Benjamin Graham
No management data available.
Risk Analysis
YUM (YUM) fundamental analysis — Overall grade B based on profitability, financial health, valuation and cash flow. Graham's
Fair Value: N/A. Gross profit margin: 46.2%. Operating margin: 30.8%. Net margin: 19.0%. Analysis powered by 360investing — free fundamental stock analysis based on Benjamin Graham and Warren Buffett
principles.
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and may be delayed, inaccurate, or incomplete. Past performance is not indicative of future results. Analysis, scores, and valuations are algorithmic and do not represent professional investment recommendations. Always conduct your own due
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