Before the Call: Taste Test at Yum! Brands

For well over a year, Yum! Brands (NYSE: YUM) has been making toast out of Wall Street's earnings estimates. Will Wednesday's earnings report stick a fork in the analysts?

After the news comes out, we'll have time aplenty to dissect it. But in these few hours before we begin obsessing over Yum!'s short-term progress, let's take a moment to review what investors think about it as a long-term investment. Our tool in this endeavor: Motley Fool CAPS, where we poll more than 59,000 investors for their views on more than 4,000 companies, Yum! among them. Here's what Fools have to say about it.

Up or down?
Nearly 500 investors have submitted ratings on Yum! Brands. Their verdict: "Kinda bland."

Nine out of 10 CAPS investors expect Yum! to outperform the market. Even so, the stock remains stuck at just three CAPS stars, out of a possible five.

Yet among fast food purveyors, only a couple of stocks get higher ratings:

Fast Food Group	CAPS Rating
Chipotle (NYSE: CMG-B)	****
Sonic (Nasdaq: SONC)	****
Yum! Brands	***
McDonald's (NYSE: MCD)	***
CKE Restaurants (NYSE: CKR)	***
Wendy's (NYSE: WEN)	*
Burger King (NYSE: BKC)	*

Wall Street vs. Main Street
Raised on a diet of caviar and Cristal, Wall Street sniffs at Yum! Brands' plebeian fare. The stock gets only an 80% approval rating from the analysts who follow it (four out of five). But the analysts have egg on their face, as the stock is beating the S&P 500 by a baker's dozen of percentage points over the past 52 weeks.

Bull pitch
You've all heard the China-is-the-world's-biggest-market theory about why automaker A, computer hawker B, and steel smelter C will experience limitless growth, right? Well, people use this argument to promote fast food purveyors, too. Witness the top-rated CAPS pitch on Yum!:

"I have been to China 3 times in the last year and have seen three very important things: 1) a lot of KFCs and Pizza Hut stores; 2) Long lines including lines out the door at a Pizza Hut in Shanghai on a Saturday night; and 3) a number of suppliers producing product (packaging, etc.) for KFC and talking about the growth of that business. Combine that with increases in wages (20-25% per year) in China creating improving standard of living for the working class (therefore, more customers for quick-service restaurants), a dominance over McDonald's (beef is not as big of a part of the Chinese diet), and a first-mover advantage in China, and you have a clear winner for the next 5-10 years."

Bear pitch
Bears don't have a lot of nice things to say about Yum! They call the restaurants "nasty," the stock "overpriced," and make allusions to "rats" -- which I'm assuming were sighted at the restaurants, and not nibbling on the ticker symbol in The Wall Street Journal. Other bogeymen haunting this stock include: "law suits," "trans fats," and for the international biologists in our audience, both "e-coli" and its Italian strain "ecoli."

Who said that?
To learn the identities of the wise Fools who penned these words, and to explore the plethora of additional financial data we've put together on the company, just click here.

Tacos and pizza make fine college fare, but the discerning adult investor might want to try something a bit more upscale. Might I suggest an all-access pass to Motley Fool Hidden Gems, where we recently recommended a certain "gourmet restaurant where you eat with your hands" to our members? And on the off chance that the restaurant stock is not your cup of tea, we've got dozens of other ideas to choose from.

Fool contributor Rich Smith does not own shares of any company named above. You can find him on CAPS, publicly pontificating under the handle TMFDitty, where he's ranked No. 977 out of more than 59,000 investors. Chipotle shares are recommended in both Hidden Gems and Rule Breakers.