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Yum Brands Inc  (NYSE:YUM) Asset Turnover: 0.27 (As of Jun. 2017)

Asset Turnover measures how quickly a company turns over its asset through sales. It is calculated as divided by . Yum Brands Inc's for the three months ended in Jun. 2017 was \$1,448 Mil. Yum Brands Inc's for the quarter that ended in Jun. 2017 was \$5,374 Mil. Therefore, Yum Brands Inc's asset turnover for the quarter that ended in Jun. 2017 was 0.27.

Asset Turnover is linked to through Du Pont Formula. Yum Brands Inc's annualized for the quarter that ended in Jun. 2017 was -13.83%. It is also linked to through Du Pont Formula. Yum Brands Inc's annualized for the quarter that ended in Jun. 2017 was 15.33%.

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Yum Brands Inc Annual Data

 Dec07 Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Asset Turnover 1.53 1.48 0.77 0.79 0.94

Yum Brands Inc Quarterly Data

 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Asset Turnover 0.18 0.36 -0.32 0.27 0.27

Calculation

Asset Turnover measures how quickly a company turns over its asset through sales.

Yum Brands Inc's Asset Turnover for the fiscal year that ended in Dec. 2016 is calculated as

 Asset Turnover = Sales / Average Total Assets = (A: Dec. 2016 ) / ( ( (A: Dec. 2015 ) + (A: Dec. 2016 )) / 2 ) = 6366 / ( (8061 + 5478) / 2 ) = 6366 / 6769.5 = 0.94

Yum Brands Inc's Asset Turnover for the quarter that ended in Jun. 2017 is calculated as

 Asset Turnover = Sales / Average Total Assets = (Q: Jun. 2017 ) / ( ( (Q: Mar. 20 ) + (Q: Jun. 2017 )) / 2 ) = 1448 / ( (5151 + 5596) / 2 ) = 1448 / 5373.5 = 0.27

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Companies with low profit margins tend to have high asset turnover, while those with high profit margins have low asset turnover. Companies in the retail industry tend to have a very high turnover ratio.

Explanation

Asset Turnover is linked to Return on Equity (ROE) through Du Pont Formula.

Yum Brands Inc's annulized for the quarter that ended in Jun. 2017 is

 (Q: Jun. 2017 ) = / = 824 / -5957 = ( / ) * ( / ) * ( / ) = (824 / 5792) * (5792 / 5373.5) * (5373.5/ -5957) = * * Leverage Ratio = 14.23 % * 1.0779 * -0.902 = * Leverage Ratio = 15.33 % * -0.902 = -13.83 %

Note: The data used here is four times the quarterly (Jun. 2017) net income data. The data used here is four times the quarterly (Jun. 2017) revenue data.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

It is also linked to Return on Assets (ROA) through Du Pont Formula:

Yum Brands Inc's annulized for the quarter that ended in Jun. 2017 is

 (Q: Jun. 2017 ) = / = 824 / 5373.5 = ( / ) * ( / ) = (824 / 5792) * (5792 / 5373.5) = * = 14.23 % * 1.0779 = 15.33 %

Note: The data used here is four times the quarterly (Jun. 2017) net income data. The data used here is four times the quarterly (Jun. 2017) revenue data.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Be Aware

In the article Joining The Dark Side: Pirates, Spies and Short Sellers, James Montier reported that In their US sample covering the period 1968-2003, Cooper et al find that firms with low asset growth outperformed firms with high asset growth by an astounding 20% p.a. equally weighted. Even when controlling for market, size and style, low asset growth firms outperformed high asset growth firms by 13% p.a. Therefore a company with fast asset growth may underperform.

Therefore, it is a good sign if a company's asset turnover is consistent or even increases. If a company's asset grows faster than sales, its asset turnover will decline, which can be a warning sign.

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