TRI:CC - Thomson Reuters Will Expand Margins But Its Qualities Are Priced In

• TRI is mainly an enterprise solutions-focused business, even though most of us know it for its news segment.
• They are migrating their revenue to the cloud as part of the change programme, and putting all their chips on digital solutions.
• The pandemic has been a tailwind, and the currently flat EBITDA evolutions are a consequence of the change programme.
• They expect that once the change programme is complete, with 90% cloud based digital solutions by 2023, their margins should trend upwards to 40%.
• We take their word for it on the margin front, and according to our thoughts on valuation, because of their organic growth being strong, the company trades fairly.

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