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Tuesday, May 15, 2012

I Plan to Buy Yum! Brands' Shares Next Month

As stated in this article, I already had one share of Visa (ticker:V) and I plan to increase my portfolio value. After doing some research and implementing Ben Graham's theory, I decided to buy Yum! Brands, Inc. (ticker: YUM) shares.

According to Google Finance, Yum! Brands, Inc. is a quick service restaurant company based on number of system units, with approximately 37,000 units in more than 120 countries and territories. The Company through its three concepts of KFC, Pizza Hut and Taco Bell (the Concepts), develops, operates, franchises and licenses a worldwide system of restaurants, which prepare, package and sell a menu of priced food items. Units are operated by a Concept or by independent franchisees or licensees under the terms of franchise or license agreements. In addition, YUM owns non-controlling interests in Chinese entities who operate in a manner similar to KFC franchisees, as well as a non-controlling interest in Little Sheep Group Limited (Little Sheep). It operates in five segments: YUM Restaurants China, YUM Restaurants International, Taco Bell U.S., KFC U.S. and Pizza Hut U.S. In December 2011, it sold the Long John Silver's and AW All-American Food Restaurants brands. On February 1, 2012, it acquired Little Sheep.

The company runs franchise business and has a large of units. I predict such business will boom in the future along world's economy rises in emerging countries like Indonesia, India, and China.

I also have compared this stock with their competitors: MCD, DNKN, PZZA, and some related companies. YUM is just under MCD which has highest capitalization. So, it's the right choice to buy and hold forever.