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Should You Buy-the-Dip in Thomson Reuters Stock?

Thomson Reuters (TSX:TRI)(NYSE:TRI) is a Toronto-based company that is engaged in the provision of business information services in the Americas, Europe, the Middle East, Africa, and the Asia Pacific. Shares of this top Canadian stock have dropped 6.5% month-over-month as of close on Wednesday, May 24. The stock is still up 6.1% so far in 2023. Today, I want to discuss whether it is worth buying into Thomson Reuters’ recent dip.

This company released its first quarter fiscal 2023 earnings on May 2. Thomson Reuters delivered total revenue growth of 4% and organic revenue growth of 6%. That growth was powered by improved performance in Thomson Reuters’ “Big 3” segments; Legal Professionals, Corporates, and Tax & Accounting Professionals). Indeed, the “Big 3” made up 82% of the company’s revenues. The company reaffirmed its full-year 2023 organic revenue and adjusted EBITDA margin outlook.

Operating profit increased 23% year-over-year to $508 million in the first quarter of fiscal 2023 on the back of higher revenues. Moreover, adjusted EBITDA climbed 13% to $677 million. Adjusted earnings per share (EPS) jumped 24% year-over-year to $0.82 while free cash flow also increased 58% to $133 million.

Shares of Thomson Reuters are trading in middling value territory at the time of this writing. This stock offers a quarterly dividend of $0.49 per share. That represents a modest 1.5% yield. Thomson Reuters is a giant that investors can trust for the long term, but it doesn’t offer the kind of value or income that I’d consider worth to make a move on at this stage.