Grubhub Scores Major Win with Yum! Brands Partnership

It was a big day for Grubhub in the stock market on Thursday as shares were rallying 27%.

The company announced that it has formed a partnership with Yum! Brands, the name behind KFC, Taco Bell, and Pizza Hut.

In the deal, Yum will acquire $200 million in Grubhub shares.

According to Mizuho analysts, “This will be an exclusive partnership, and according to the release, GrubHub will be integrated into the POS. This is a major win for GrubHub as it will likely be accompanied by a joint marketing campaign during the rollout phase.”

“While GrubHub is the leading marketplace for takeout online, we have converted only a small portion of the U.S. population from the paper menu to online ordering,” Maloney said on the company’s earnings call. “By leveraging a joint national go-to-market strategy, we believe that we will access new parts of the demand funnel that we have not been able to reach before.”

The company released quarterly earnings revealing adjusted EPS of 37 cents on sales of $205.1 million.

Analysts had been waiting for EPS of 31 cents and sales of $202 million.

According to Grubhub’s CEO Matthew Maloney, his company was filling an average of 300 orders every minute in the last quarter.

Yum! Brands also reported their earnings revealing adjusted EPS of 96 cents on sales of $1.58 billion. Analysts had called for EPS of 80 cents on sales of $1.59 billion.

Disclaimer: We have no position in GrubHub Inc. (NYSE: GRUB) nor Yum! Brands, Inc. (NYSE: YUM) and have not been compensated for this article.