On Wednesday, BMO (TSX:BMO) Capital Markets maintained its Outperform rating and a price target of Cdn$222.00 on shares of Thomson Reuters (TSX:TRI) (NYSE:TRI:CN) (NYSE: TRI). The firm's analyst highlighted the company's positive long-term outlook, citing the recent investor day presentations that reinforced Thomson Reuters' strong growth drivers.
According to the analyst, the company is well positioned to capitalize on generational artificial intelligence (GenAI) opportunities due to its proprietary databases, deep sector expertise, and established customer relationships.
Thomson Reuters has been focusing on a balanced capital allocation strategy that includes dividend growth, mergers and acquisitions (M&A), and organic investments. Since 2021, the company has spent approximately $2.2 billion on M&A activities. Additionally, the company is committed to growing its dividend, with an approximate 10% increase, demonstrating confidence in its financial strength and commitment to shareholder returns.
The company's strategic investments and financial management have positioned it to have around $8 billion in capital capacity by 2026. This financial flexibility is expected to support Thomson Reuters' ongoing growth initiatives and potential future investments, as it continues to build on its operational and financial scale.
The endorsement from BMO Capital Markets reflects a positive assessment of Thomson Reuters' business model and its ability to thrive in an evolving digital landscape. The company's focus on leveraging its assets to support advanced technological developments like GenAI appears to be a key factor in its growth strategy.
Thomson Reuters' approach to capital deployment and its optimistic growth projections were key points of emphasis in the analyst's comments.
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