Major Bank Ratings | Morgan Stanley: Yum China Maintains Growth Momentum in the Third Quarter, Reiterates "Overweight" Rating

格隆汇 July 31｜Morgan Stanley released a research report stating that Yum China’s same-store sales target for the third quarter recorded positive growth, and July’s performance met the company’s expectations. Accelerated store expansion brings greater growth potential. Morgan Stanley reaffirmed its “Overweight” rating for Yum China’s US stock, maintaining the target price at $60, and considers it a preferred stock. Morgan Stanley adjusted its earnings forecasts for 2026 to 2028 by up to 1% to reflect the faster pace of new store openings, not yet taking into account the potential impact of the Pizza Hut acquisition. The firm believes the current valuation is attractive and forecasts the CAGR of operating profit and EPS for 2025 to 2027 to reach 10% and 15%, respectively.