Put Options on YUM on 2/11/2013

Yum! Brands, Inc. (YUM) is a quick service restaurant company based on number of system units, with approximately 37,000 units in more than 120 countries and territories. The Company through its three concepts of KFC, Pizza Hut and Taco Bell (the Concepts), develops, operates, franchises and licenses a worldwide system of restaurants, which prepare, package and sell a menu of priced food items. Units are operated by a Concept or by independent franchisees or licensees under the terms of franchise or license agreements. In addition, YUM owns non-controlling interests in Chinese entities who operate in a manner similar to KFC franchisees, as well as a non-controlling interest in Little Sheep Group Limited (Little Sheep). It operates in five segments: YUM Restaurants China, YUM Restaurants International, Taco Bell U.S., KFC U.S. and Pizza Hut U.S. In December 2011, it sold the Long John Silver's and A&W All-American Food Restaurants brands. On February 1, 2012, it acquired Little Sheep.

Stockwinners.com is bearish on this name for the following reasons:

1. The company’s chicken suppliers in China are being investigated by their version of the FDA, and then have recently suggested that this is more of a supplier issue than a YUM issue, despite pr issues and lost sales.This could drag the stock lower in the next few weeks.
2. The goal here is to bank on the move by choosing a high delta strike.

Trade Buy 1 March $60.00 Put at $0.40 For a net debit of $0.40 Profit/Loss Analysis Breakeven at $59.60 Maximum profit is unbounded Maximum loss is ($40.00) at strike of $60.00 Closing Summary Sold 1 March $60.00 Put at $0.00

Position closed on 3/15/2013 at price of $0.00 with a -100.00% loss in 31 days.

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