Yum China: steady growth through expansion and effective strategy

Restaurant conglomerate Yum China, $YUMC which includes brands such as KFC in China, has seen solid growth through a combination of promotions, store expansion, share buybacks and tight cost control. Chen Luo, an analyst at Bank of America, points out that these measures put Yum China in an advantageous position in China's challenging macroeconomic environment.

Competition with McDonald's and local expansion

Although expansion McDonald's in Shanghai is a competitive pressure, Luo believes that Yum China has the potential to compete through strategic expansion of the chain KFC and the ability to adapt to local competition.

Stock growth and third quarter expectations

Shares of Yum China are up $YUMC6% YoY , reflecting investor confidence in the company's strategy and expectations for further growth. Third-quarter results, due to be released on Nov. 4, may provide greater insight into the company's continued growth plans and ability to manage challenging market conditions in China.