Darden Restaurants, Inc. (DRI) vs Yum China (YUMC)

Darden Restaurants, Inc. and Yum China are both Restaurants companies. Darden Restaurants, Inc. is the larger, with a market value of $25.9B against $17.0B — 1.5× the size. Yum China trades at the lower P/E: 17.2× against 22.1×. Yum China grew revenue faster over the last twelve months: 9.85% against 8.10%. Darden Restaurants, Inc. has the higher net margin (8.85% vs 7.90%) and the higher return on invested capital (28.0% vs 14.9%). Both pay a dividend; Darden Restaurants, Inc. yields more (2.74% vs 2.23%). Across the 23 metrics below, Yum China leads on 12 and Darden Restaurants, Inc. on 11.

Valuation

Metric DRI YUMC Restaurants median
P/E 22.12 17.19 26.18
P/S 1.94 1.34 1.11
P/B 12.52 2.79 2.06
Price to free cash flow 24.38 17.92 17.92
EV/EBITDA 12.81 8.88 12.81
EV/Sales 2.04 1.33 1.29
Earnings yield 4.52% 5.82% 2.23%
Free cash flow yield 4.10% 5.58% 3.23%

Profitability

Metric DRI YUMC Restaurants median
Gross margin 21.66% 0.00% 38.86%
Operating margin 11.69% 11.28% 4.59%
Net margin 8.85% 7.90% 1.83%
Free cash flow margin 7.95% 7.46% 2.47%
Return on equity 55.07% 16.09% 3.72%
Return on assets 9.10% 8.57% 1.10%
Return on invested capital 28.04% 14.87% 3.01%

Growth

Metric DRI YUMC Restaurants median
Revenue growth (TTM) 8.10% 9.85% 5.52%
EPS growth (last fiscal year) 17.16% 7.73% (5.05%)
Revenue growth, 5-year CAGR 12.92% 7.38% 10.57%
Net income growth, 5-year CAGR 13.91% 3.45% 0.00%

Health

Metric DRI YUMC Restaurants median
Debt to equity 0.79 0.26 0.22
Current ratio 0.30 0.67 0.78
Net debt to EBITDA 0.66 (0.75) 0.43

Dividend

Metric DRI YUMC Restaurants median
Dividend yield 2.74% 2.23% 1.79%
Payout ratio 0.61 0.39 0.45

Size

Metric DRI YUMC Restaurants median
Market cap 25.87b 17.04b 612.23m

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