Thomson Reuters Wins Repurchase Approval For 5M Shares; Street Sees 13% Upside

Thomson Reuters on Dec. 29 announced that the Toronto Stock Exchange (TSX) approved the repurchase of up to 5 million common shares under its normal course issuer bid (NCIB) between Jan. 4, 2021, and Jan. 3, 2022.

The 5 million shares represent 1% of its issued and outstanding common shares for the business information services provider.

Thomson Reuters (TRI) has set a target to maintain 500 million common shares outstanding by using share repurchases to offset dilution by its dividend reinvestment and equity incentive plans. There were 497,117,528 common shares outstanding on Dec. 24.

The company had repurchased 6.9 million common shares out of the 25 million common shares authorized by the previous NCIB between Aug. 19, 2019 and Aug. 18, 2020. The shares had been repurchased for a total of $500 million, representing an average price of $72.61 per share. The company’s shares closed at $81.60 on Dec. 29.

On Dec. 2, Credit Suisse analyst Kevin McVeigh raised the price target on the stock from $100 to $105 and reiterated a Buy rating. The new price target implies 28.7% upside potential.

Overall, the rest of the Street has a cautiously optimistic outlook on the stock. The Moderate Buy analyst consensus is based on 4 Buys and 4 Holds. (See TRI stock analysis on TipRanks)

With shares up 14% year-to-date, the average price target stands at $92.12 and implies close to 13% upside potential at current levels.

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