On Wednesday, JPMorgan reaffirmed its Neutral rating on Thomson Reuters shares (NYSE:TRI:CN) (NYSE: TRI), following the company's Investor Day held on Tuesday. Thomson Reuters outlined a strategy for revenue growth through 2026, highlighting the integration of data content with software subscriptions—a trend the company exemplifies well within the Information Services sector.
During Investor Day, Thomson Reuters introduced ambitious organic revenue growth targets for its three main segments. The Legal segment is projected to grow by 7-8%, Tax & Accounting by 10-12%, and Corporates by 8-10%.
Collectively, these targets suggest an overall revenue acceleration for the company, potentially positioning Thomson Reuters as a high-single-digit grower among its peers in the Information Services group.
Thomson Reuters' leadership, including Raghu Ramanathan, the new President of Legal Professionals who joined the company in February 2024 after nearly two decades at SAP, was deemed credible in steering the company through a period marked by the rise of generative AI.
The company showcased various product demonstrations, such as Westlaw Precision, Ask Practical Law AI, Intelligent Drafting, Checkpoint Edge AI-Assisted Tax Research, SurePrep, and CoCounsel.
The company's past performance under the 2021-2023 Change Program was noted as a positive indicator of its ability to execute strategies effectively. This program has largely transitioned the company's revenue to the cloud, reorganized teams into cross-functional groups, and increased engineering velocity, which could be advantageous as the company navigates the generative AI landscape.
Despite the potential outlined during the Investor Day, JPMorgan cautions that it is still early in the generative AI journey. The adoption curve of generative AI by clients remains uncertain, leaving some questions about the future uptake of Thomson Reuters' offerings in this innovative field.
JPMorgan's Information Services Data Book (ISDB) primer, which benchmarks Thomson Reuters against its peer group, is available to clients upon request.
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