Is Yum China Holdings, Inc. overvalued or undervalued?

As of 7 November 2025, the valuation grade for Yum China Holdings, Inc. moved from very expensive to expensive, indicating a slight improvement yet still suggesting that the stock is overvalued. The company exhibits a P/E ratio of 17, a Price to Book Value of 2.93, and an EV to EBITDA of 8.51, which are relatively high compared to its peers. For instance, Yum! Brands, Inc. has a P/E of 28.45, while Darden Restaurants, Inc. shows an EV to EBITDA of 13.85, highlighting that Yum China is positioned on the higher end of the valuation spectrum within its industry.
In terms of performance, Yum China has underperformed the S&P 500 over multiple periods, with a year-to-date return of -9.51% compared to the S&P 500's 14.40%. This trend continues over one year and three years, where Yum China returned -15.29% and -11.62%, respectively, against the S&P 500's positive returns. Overall, the combination of high valuation ratios and poor stock performance suggests that Yum China Holdings, Inc. is overvalued.