Using the PEG framework with analyst consensus forward EPS growth of 16.8% plus 1.8% dividend yield, Yum! Brands, Inc. has a fair value of $112.23 based on NTM EPS (FY2026) of $6.67. The current PEG ratio is 1.40.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG is most informative for high-growth companies — the PEG sweet spot.
| EPS Growth RateForward | 15.0% |
| Dividend Yield | +1.8% |
| Adjusted Growth (clamped 8–25%) | 16.8% |
| Fair P/E | 16.8x |
| NTM EPS (FY2026) | $6.67 |
| Fair Value | $112.23 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $5.56 | — | — |
| FY2026E | $6.67 | +20.0% | 19 |
| FY2027E | $7.47 | +12.0% | 19 |
| FY2028E | $8.41 | +12.6% | 13 |
| FY2029E | $9.69 | +15.3% | 12 |
| FY2030E | $11.19 | +15.5% | 6 |
5Y Forward EPS CAGR: 15.0%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $1.6B | $5.22 | — |
| FY2022 | $1.3B | $4.57 | -12.5% |
| FY2023 | $1.6B | $5.60 | +22.5% |
| FY2024 | $1.5B | $5.22 | -6.8% |
| FY2025 | $1.6B | $5.56 | +6.5% |
4Y Historical EPS CAGR: 1.6%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.