Is Yum China Holdings, Inc. overvalued or undervalued?

As of 17 October 2025, Yum China Holdings, Inc. has moved from a fair to an expensive valuation grade. The company appears to be overvalued based on its current metrics, with a P/E ratio of 17, a Price to Book Value of 2.93, and an EV to EBITDA of 8.51. In comparison, Yum! Brands, Inc. has a higher P/E ratio of 28.45, while Darden Restaurants, Inc. shows a P/E of 23.58, indicating that Yum China is trading at a lower valuation relative to some peers, yet still classified as expensive.
The company has experienced a decline in returns, with a YTD return of -9.03% compared to the S&P 500's 13.30%, and over the past five years, it has dropped by 18.06% while the S&P 500 has gained 91.29%. This stark contrast in performance further supports the conclusion that Yum China Holdings, Inc. is currently overvalued.