If I could put every dollar I have into a single stock and leave it alone for the next decade, it would be Thomson Reuters (TSX: TRI).
This Toronto-based content and technology company is not flashy and does not trade on hype. But it sits at the intersection of artificial intelligence, professional services, and irreplaceable data.
Valued at a market cap of $57 billion, this large-cap Canadian stock is down 56% from all-time highs.
Source: Getty Images
Is this TSX tech stock a good buy?
Most Canadians still think of Thomson Reuters as a news wire and legal database business.
However, over the past six years, CEO Steve Hasker and outgoing CFO Mike Eastwood have transformed the company into something much more valuable.
- In 2019, total organic revenue growth was 4%, and EBITDA (earnings before interest, taxes, depreciation, and amortization) margins sat at 31.5%.
- For 2026, the company is guiding to 7.5% to 8% total organic growth, nearly 9.5% for its three core segments, and EBITDA margins exceeding 40%.
- Free cash flow could almost double from US$1.1 billion in 2019 to US$2.1 billion in 2026.
The Canadian stock has an AI moat
Thomson Reuters has a widening AI moat.
- TRI’s legal AI product, CoCounsel, has crossed one million users.
- Its Westlaw Advantage product, launched in August 2025, is performing well above expectations.
- And a brand new version of CoCounsel, currently in alpha with a couple of hundred customers, moves into beta on April 20 and is set for general release in the summer of 2026.
- Thomson Reuters aims to target fiduciary-grade professionals, including lawyers, taxmen, and auditors, thereby narrowing the competitive field significantly.
Hasker outlined four specific advantages the company brings to that market.
- The first is its massive proprietary data repositories that competitors are unable to replicate.
- The second is 4,500 trained domain experts who validate AI outputs before they reach customers.
- The third is an ironclad data privacy guarantee, meaning client inputs never become part of AI training data.
- The fourth is round-the-clock expert support that no startup can match at scale.
“AI cannot be trusted to check AI,” Hasker noted at the conference. This statement explains why Thomson Reuters occupies a durable competitive position that general-purpose AI models cannot easily threaten.
A growing dividend payout
Thomson Reuters has raised its dividend 10% annually for five straight years. In fact, the TSX dividend stock has raised its annual payout from US$1.01 per share in 2006 to US$2.62 per share in 2026, indicating a yield of 2.7%.
It recently executed a US$1.2 billion share buyback and still has ample firepower for strategic acquisitions in segments such as indirect tax, electronic invoicing, and fraud and compliance, all of which Hasker identified as double-digit growth opportunities.
The Tax, Audit, and Accounting Professionals segment is guiding to 11%–13% organic growth for 2026. A labour shortage in the profession is creating tailwinds, as firms lean harder on Thomson Reuters products to do more work with fewer people.
The Foolish takeaway
Thomson Reuters is a compounding machine with a defensible AI strategy, a growing dividend, and a balance sheet that gives management real options.
Analysts tracking the Canadian dividend stock forecast free cash flow to expand from US$1.95 billion in 2025 to US$2.87 billion in 2029.
If TRI stock is priced at 25 times forward FCF, which is below its 10-year average of 37 times, it could surge over 70% within the next three years. If we account for dividends, cumulative returns could be closer to 80%.
