Thomson Reuters Swings to Loss in Q4

Shares of Thomson Reuters (TSE: TRI) were down in early trading Tuesday after the provider of business information services reported higher revenue but swung to a loss in the fourth quarter.

Revenues & Earnings

Revenues came in at $1.71 billion for the quarter ended December 31, an increase of 6% from $1.61 billion in the prior-year quarter.

The company reported a loss of $175 million (-$0.36 per diluted share) in Q4 2021, compared with a profit of $562 million ($1.13 per diluted share) in Q4 2020. The loss is due to lower operating profit and a decline in the value of the company’s investment in the London Stock Exchange Group.

On an adjusted basis, Thomson Reuters earned $0.43 per share, down from $0.54 in the prior-year period.

CEO Commentary

Thomson Reuters president and CEO Steve Hasker said, “The momentum we saw in the first nine months of the year continued in the fourth quarter. Revenue and sales growth were again strong and exceeded our expectations, enabling us to finish the year on a solid footing. Our performance has increased momentum moving into 2022, helping to build confidence as we work to achieve our higher 2022 and 2023 targets.”

Guidance Update and Dividend Increase

The company is now expecting revenue growth of around 5% this year, compared to 4-5% previously forecasted, and expects 5.5-6% growth in 2023, compared to 5-6% previously.

The board of directors has approved a 10% or $0.16 per share increase in the quarterly dividend to $0.445 per common share. This is the 29th consecutive year of dividend increases.

Wall Street’s Take

Last month, National Bank analyst Adam Shine upgraded TRI to Buy from Hold and set a C$162 price target. This implies 26.7% upside potential.

As Adam Shine is the only analyst to have offered a stock rating for TRI in the last three months, the average Thomson Reuters price target is C$162.

TipRanks’ Smart Score

TRI scores a 4 out of 10 on TipRanks’ Smart Score rating system, indicating that its stock has a good chance of performing in line with the overall market.

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