Analysts looking for evidence of improving sales when Yum Brands reports 2Q results

Ahead of the Bell: Yum Brands 2Q results

LOUISVILLE, Ky. — Analysts will be looking for signs that sales are improving when Yum Brands Inc. reports second-quarter results after the close of regular trading on Tuesday.

In the first quarter, the fast food company that owns Taco Bell, Pizza Hut and KFC, said sales in U.S. stores open at least a year slipped 1 percent, continuing a recent trend.

Mark Kalinowski, an analyst at Janney Capital Markets, is predicting another slight decline in second-quarter revenue at stores open at least a year. He said the continued sluggish U.S. performance will be more than offset by the company’s sales in China, which has become a highly profitable market.

He expects Pizza Hut, which put considerable “marketing muscle” behind a $10 pizza promotion, to show solid revenue at stores open at least a year. But he forecast a slight drop in the figure at Taco Bell and perhaps KFC.

Kalinowski has a buy rating for Yum, based largely on the company’s potential outside the U.S.

Analysts surveyed by Thomson Reuters on average expect Yum, based in Louisville, Ky., to earn 54 cents per share on revenue of $2.54 billion.

Last year, it earned 63 cents per share on revenue of $2.5 billion. Excluding one-time items, the company earned 50 cents per share.