In the past few quarters, Yum’s earnings growth has been heavily dependent on how well its chicken chain KFC has fared. Luckily for the company, KFC’s “Southern Inspired” sandwiches have been well-received by consumers.
Like Pizza Hut, KFC struggled with sales growth several years ago, requiring a $180 million investment from Yum to set things straight. The result has been 13 quarters of positive same-store sales growth since the third quarter of 2014. The streak is expected to continue in the first quarter as analysts predict same-store sales growth of 2.6 percent.
Last quarter, Yum said it had taken a 3 percent stake in online food-ordering company Grubhub, a $200 million investment, and had begun testing delivery at KFC. Investors want to see if the company adds delivery at more locations.
Online orders tend to create higher check averages, so expanding delivery could give KFC a boost.
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