Shares shifted as Thomson Reuters bounced +4.0% to $82.23 on May 15, but the rally barely dents a bruising slide — the stock has plunged 33.4% year-to-date , falling from a July 2025 all-time high of $207.91 . The core tension: Wall Street bulls see a durable data business being mispriced, while the market keeps punishing the stock every time a new AI headline lands.
A Solid Quarter Couldn't Stop the Bleeding
Thomson Reuters reported Q1 2026 revenue up 10% year-over-year, beating analyst expectations , and delivered earnings of $1.23 per share versus the $1.20 consensus . Management backed its full-year outlook, including roughly $2.1 billion in free cash flow — the cash left after running the business . Yet the stock fell anyway, because investors are worried less about today's numbers and more about whether AI competitors can replicate what Thomson Reuters sells.
Anthropic's New Tools Triggered the Latest Selloff
Shares initially dropped after Anthropic unveiled new AI agents designed to handle a broader mix of financial-services tasks . The fear: if general-purpose AI can do legal research or tax calculations cheaply, Thomson Reuters' subscription pricing power — the company's ability to charge clients steadily rising fees — erodes. Analysts are split. RBC upgraded the stock to Outperform citing AI upside, while Wells Fargo downgraded it, highlighting competition from AI-powered startups in legal research .
Management Says Its Data Can't Be Easily Copied CEO Steve Hasker is framing the threat as an opportunity. He claims Thomson Reuters is "the only company" that can deliver what he calls "fiduciary-grade AI" — AI accurate enough for professions where "users cannot afford to be wrong" . In legal specifically, law-firm customers grew 11% organically, up from 9% the prior quarter, driven by new AI-powered research and drafting tools . That acceleration is real, but it needs to persist to justify the stock's still-premium valuation.
The Valuation Gap Tells the Story
At roughly 20× estimated 2026 earnings, TRI sits well below its own five-year average forward price-to-earnings ratio — a measure of how much investors pay per dollar of profit — which has historically been closer to 35× . The average analyst price target is $155.22, implying 96% upside . The market, however, is demanding proof that proprietary legal and tax databases remain irreplaceable in an era when AI models improve by the month. Until that proof arrives quarter after quarter, the discount is likely to stick.