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McDonald's Corporation (MCD) vs Yum China (YUMC)

McDonald's Corporation and Yum China are both Restaurants companies. McDonald's Corporation is the larger, with a market value of $196.8B against $17.0B — 11.5× the size. Yum China trades at the lower P/E: 17.2× against 22.6×. Yum China grew revenue faster over the last twelve months: 9.85% against 5.77%. McDonald's Corporation has the higher net margin (32.4% vs 7.90%) and the lower return on invested capital (0.00% vs 14.9%). Both pay a dividend; McDonald's Corporation yields more (2.68% vs 2.23%). Across the 22 metrics below, Yum China leads on 15 and McDonald's Corporation on 7.

Valuation

Metric MCD YUMC Restaurants median
P/E 22.57 17.19 26.18
P/S 7.09 1.34 1.11
P/B n/m 2.79 2.06
Price to free cash flow 24.84 17.92 17.92
EV/EBITDA 15.78 8.88 12.81
EV/Sales 8.56 1.33 1.29
Earnings yield 4.43% 5.82% 2.23%
Free cash flow yield 4.03% 5.58% 3.23%

Profitability

Metric MCD YUMC Restaurants median
Gross margin 57.61% 0.00% 38.86%
Operating margin 46.94% 11.28% 4.59%
Net margin 32.38% 7.90% 1.83%
Free cash flow margin 0.00% 7.46% 2.47%
Return on equity 0.00% 16.09% 3.72%
Return on assets 0.00% 8.57% 1.10%
Return on invested capital 0.00% 14.87% 3.01%

Growth

Metric MCD YUMC Restaurants median
Revenue growth (TTM) 5.77% 9.85% 5.52%
EPS growth (last fiscal year) 4.92% 7.73% (5.05%)
Revenue growth, 5-year CAGR 6.96% 7.38% 10.57%
Net income growth, 5-year CAGR 12.60% 3.45% 0.00%

Health

Metric MCD YUMC Restaurants median
Debt to equity (38.97) 0.26 0.22
Current ratio 1.08 0.67 0.78
Net debt to EBITDA 2.69 (0.75) 0.43

Dividend

Metric MCD YUMC Restaurants median
Dividend yield 2.68% 2.23% 1.79%
Payout ratio 0.59 0.39 0.45

Size

Metric MCD YUMC Restaurants median
Market cap 196.75b 17.04b 612.23m

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