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Guy Adami: Yum! Still has Room to Upside

The Fast traders had Yum on the radar after the company posted higher-than-expected earnings largely due to growth in China.

Sales at established restaurants in China rose 18 percent in the second quarter, however, China restaurant margins fell 0.5 basis points to 19.7 percent on higher wage and commodity costs.

Based on strength in its international business, Yum raised its full-year earnings per share growth forecast to at least 12 percent from at least 10 percent previously.

”Those numbers out of China were astounding,” says Karen Finerman. “They’ve done an extraordinary job building their business in China. I love the name. However at 20 times earnings, I don’t love the valuation.”

Guy Adami feels differently, “valuation has been a concern for the last $15 - $20,” he says. But even at $57 it probably has room to the upside.







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Trader disclosure: On July 13 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Weiss owns (UUP); Weiss owns (TBT); Weiss owns (KEY); Weiss owns (QCOM); Weiss owns (NAV); Weiss owns (HBAN); Weiss owns (CMA); Weiss owns (NAV); Weiss owns (NS); Weiss owns (ETP); Weiss owns (UGL); Terranova owns (XOM); Terranova owns (HAS); Terranova owns (DIS); Terranova owns (WFM); Terranova owns (LULU); Terranova owns (MSFT); Terranova owns (TM); Terranova owns (JWN); Terranova owns (MCD); Terranova owns (PEP); Terranova owns (MA); Terranova owns (BX); Terranova owns (CAT); Terranova owns (VRTS); Terranova owns (AAPL); Terranova owns (F); Terranova owns (CVI); Terranova owns (IBM); Terranova owns (FCX); Finerman's Firm Is Short (IWM); Finerman's Firm Is Short (MDY); Finerman's Firm Is Short (SPY); Finerman's Firm Is Long S&P 500 Puts; Finerman's Firm Is Long Russell 2000 Puts; Finerman's Firm And Finerman Own (AAPL); Finerman's Firm owns (BAC) leaps and Finerman Owns (BAC); Finerman Owns (GOOG); Finerman's Firm owns (JPM) leaps and Finerman Owns (JPM); Adami Owns (AGU); Adami Owns (C); Adami Owns (GS); Adami Owns (INTC); Adami Owns (MSFT); Adami Owns (NUE); Adami Owns (BTU); Finerman's Firm And Finerman Own (AAPL); Finerman's Firm owns (BAC) leaps and Finerman Owns (BAC); Finerman's Firm owns (JPM) leaps and Finerman Owns (JPM); Finerman's Firm Is Short (IWM); Finerman's Firm Is Short (MDY); Finerman's Firm Is Short (SPY); Finerman's Firm Is Long S&P 500 Puts; Finerman's Firm Is Long Russell 2000 Puts; Stutland Owns (GOOG) and short (GOOG) calls; Stutland Owns (BAC); Stutland Owns (C) and short (C) calls; Stutland Owns (GLD) and owns (GLD) call options; Stutland owns U.S. Treasuries ; Stutland's Firm Is A Market Maker Holding Positions In VIX Futures And Options, SPX options and futures, SPY options, and VXX Stock And Options

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