As geopolitical uncertainties continue to keep market volatility intact, Foolish investors are increasingly looking for buying opportunities in quality stocks. When a fundamentally strong company sees its stock decline due to broader market pressures, it should be seen as an attractive entry point for those willing to look beyond short-term noise.
That seems to be the case with one well-established Canadian company, Thomson Reuters (TSX:TRI), right now, as it continues to perform operationally despite a sharp drop in its share price. Let’s take a closer look at why TRI stock could be a strong long-term pick even after its recent decline.
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A market leader facing short-term pressure
To put it simply, Thomson Reuters is a global content and technology firm that serves professionals across legal, tax, accounting, compliance, and media industries. Its products are deeply integrated into the workflows of its clients, making its business model both sticky and resilient.
Over the past year, however, TRI stock has fallen by nearly 50%, and it’s currently trading at around $126.91 per share with a market cap of about $56.3 billion. While such a decline may raise concerns at first glance, it’s important to understand what’s happening beneath the surface.
Strong fundamentals remain intact
Despite the stock’s decline, Thomson Reuters continues to deliver steady financial growth. For the full year 2025, the company’s total revenue rose 3% year-over-year (YoY) to US$7.5 billion. More importantly, its organic revenue grew by 7% YoY with the help of strong demand across its core segments.
Meanwhile, its “Big 3” segments (Legal Professionals, Corporates, and Tax & Accounting Professionals) accounted for 82% of its total revenue and delivered 9% YoY organic growth both in the fourth quarter and for the full year.
At the same time, its profitability also improved as its adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) rose 6% from a year ago to US$3 billion, with margins expanding to 39.2% from 38.2% a year earlier. This highlights the company’s ability to scale efficiently while managing costs.
Betting big on AI-driven growth
One of the most important drivers of Thomson Reuters’s long-term story is its push into artificial intelligence (AI). The company’s CoCounsel AI platform has already been adopted by one million professionals across 107 countries.
This tool is designed for high-stakes industries, offering reliable, citation-backed insights tailored to specific jurisdictions. Its next-generation version is expected to bring more advanced capabilities, including conversational task execution that mirrors how professionals collaborate in real life.
These innovations position the company to benefit from the growing demand for AI-powered solutions in professional services — a market that is still in the early stages of adoption.
Why long-term investors may want to pay attention
Thomson Reuters is also taking steps to enhance shareholder value. It has announced a US$600 million share buyback program along with a US$605 million return of capital initiative, signalling confidence in its future.
The company now expects organic revenue growth of around 7.5% to 8% in 2026. It also anticipates further margin expansion of about 100 basis points and free cash flow of approximately US$2.1 billion. These projections suggest that the company’s growth trajectory remains intact despite recent market volatility.
While the recent decline in Thomson Reuters stock may seem concerning, its underlying business tells a different story. Overall, its strong cash flows, leadership in professional services, and commitment to shareholder returns make it a solid option for patient investors.
