Thomson Reuter’s shares, which had been down more than 6% in year 2015 through Tuesday, rose 4% after the results, their best one-day move in about four years. Ongoing reports provided by Reuters have so far shown higher-than-expected quarterly profit as the company’s biggest division that serves banks and financial institutions showed underlying revenue growth for the first time since year 2011.
Revenues and Financial & Risk segment has been reported to rise approximately at 1% in 2Q while exclusion of acquisitions and currency.
Jefferies analyst Dan Dolev said the company has been successful in migrating customers to new versions of its Eikon financial platform. According to him:
“It was very encouraging to see organic growth in F&R. Everybody has been waiting for it. They delivered it.”
The company reaffirmed its 2015 forecast, including the expectation for positive organic revenue growth.
Not to mention, according to Chief Executive Jim Smith stated in his interview today:
“The quarter and the first half just confirm the momentum that is building inside the business.”
Smith also highlighted more stability in the banking and financial services sectors than a few years ago. He also said Thomson Reuters had benefited from increasing regulation as customers seek out the company’s risk products. The net earnings of 2Q were US$ 281 million (33 cents/share) in contrast to US$ 260 million (31 cents/share) a year before. According to Thomson Reuters I/B/E/S, adjusted for special items, earnings were 52 cents/share. Analysts, on average, were looking for 50 cents/share.
About the key division, which represents more than half of the company’s overall revenue, Smith stated:
“We have seen the underlying momentum now over the past couple of years. I am confident in the trajectory, and we will maintain that trajectory of continued improvement.”