TRI downgraded but price target raised

Analyst Vince Valentini said: "We continue to like the underlying story and expect cost-saving initiatives, coupled with modest organic growth, to help Thomson deliver a 15% EPS CAGR [earnings per share compound annual growth rate] between 2014 and 2017.”

But with the stock up 28 per cent since the bank upgraded the shares to Buy in early-June 2014, it believes the valuation now more appropriately reflects the earnings outlook. 

“If net sales slip back into negative territory in Q4, and we see a pullback in the shares, we would consider upgrading the stock again."

Thomson Reuters’ fourth quarter and full year earnings for 2014 are scheduled to be announced on 11 February.

Shares of Thomson Reuters were lower at around C$47.45 on the Toronto Stock Exchange and also down at around $39.35 on the New York Stock Exchange on Wednesday. ■