RBC Capital Markets has raised its stance on Thomson Reuters to an outperform rating, citing a recent fall in the company’s stock as improving the investment case despite the disruptive potential of artificial intelligence in its end markets.
The upgrade comes in the wake of developments in the broader AI landscape: Anthropic introduced a legal plug-in for its Claude Cowork coding tool on January 30. That plug-in is designed to assist with tasks such as reviewing legal documents and producing briefings, illustrating how new agentic AI capabilities are beginning to intersect with the workflows of legal professionals.
Market action has been volatile. Thomson Reuters shares dropped by more than 20% last week amid a larger selloff across software, data and professional services firms. RBC interprets this move as having improved the balance between upside potential and downside risk for the stock.
In its analysis, RBC emphasizes a wider band of possible outcomes as agentic AI reshapes how legal and tax services are delivered. At the same time, the firm notes a higher prospective growth ceiling for Thomson Reuters over the coming years. It identifies the trajectory of the total addressable market for legal and tax services as the most important variable that will determine the company’s growth path and risk profile going forward.
Valuation is a central element of RBC’s view. The brokerage points to a forward EV/EBITDA multiple of about 12.5 times as reflecting both the opportunities and the risks that AI introduces. Against this backdrop, RBC expects Thomson Reuters to either hold or strengthen its leading positions in core legal and tax segments during the next three to five years as the company deploys new AI capabilities.
RBC provides explicit numeric expectations for Thomson Reuters’ financial trajectory: it projects mid-teens net asset value growth over the 2025-2029 period, supported by approximately 100 basis points of margin expansion annually. The firm also highlights roughly $11 billion of excess balance-sheet capacity through 2028, which it views as a potential source of share-repurchase activity and as a structural floor under the stock.
The brokerage outlines a set of catalysts it believes would help the company distinguish itself from broader AI disruption narratives. These include a steady improvement in organic revenue growth into 2026 and 2027, early revenue generation from AI products, publication of additional metrics demonstrating competitive strength, and potential partnerships or acquisitions that could reinforce Thomson Reuters’ market position.
RBC adds that if the market for legal and tax services expands as a result of AI-driven changes, that expansion could progressively narrow the gap between the company’s public-market valuation and its intrinsic value over time.
Also mentioned in market commentary is a model-driven stock-selection tool that evaluates companies across many metrics and highlights ideas based on risk-reward. That tool asks whether Thomson Reuters is currently featured in its strategies and whether there are alternative opportunities in the same sector.
Contextual note: This article reports on RBC’s published views and recent market developments related to Thomson Reuters and agentic AI capabilities, including Anthropic’s announced legal plug-in for Claude Cowork.