Thomson Reuters Debt

TRI Stock  CAD 247.36  1.96  0.80%   
Thomson Reuters Corp holds a debt-to-equity ratio of 0.422. At this time, Thomson Reuters' Debt To Assets are very stable compared to the past year. As of the 15th of March 2025, Total Debt To Capitalization is likely to grow to 0.34, while Net Debt is likely to drop about 918.6 M. With a high degree of financial leverage come high-interest payments, which usually reduce Thomson Reuters' Earnings Per Share (EPS).

Asset vs Debt

Equity vs Debt

Thomson Reuters' liquidity is one of the most fundamental aspects of both its future profitability and its ability to meet different types of ongoing financial obligations. Thomson Reuters' cash, liquid assets, total liabilities, and shareholder equity can be utilized to evaluate how much leverage the Company is using to sustain its current operations. For traders, higher-leverage indicators usually imply a higher risk to shareholders. In addition, it helps Thomson Stock's retail investors understand whether an upcoming fall or rise in the market will negatively affect Thomson Reuters' stakeholders.
For most companies, including Thomson Reuters, marketable securities, inventories, and receivables are the most common assets that could be converted to cash. However, for Thomson Reuters Corp, the most critical issue when managing liquidity is ensuring that current assets are properly aligned with current liabilities. If they are not, Thomson Reuters' management will need to obtain alternative financing to ensure there are always enough cash equivalents on the balance sheet to meet obligations.
Price Book
6.4325
Book Value
26.435
Operating Margin
0.2724
Profit Margin
0.3045
Return On Assets
0.0636
At this time, Thomson Reuters' Total Current Liabilities is very stable compared to the past year. As of the 15th of March 2025, Liabilities And Stockholders Equity is likely to grow to about 24.6 B, while Non Current Liabilities Total is likely to drop about 2.8 B.
  
Check out the analysis of Thomson Reuters Fundamentals Over Time.
To learn how to invest in Thomson Stock, please use our How to Invest in Thomson Reuters guide.

Thomson Reuters Corp Debt to Cash Allocation

Thomson Reuters Corp has accumulated 973 M in total debt with debt to equity ratio (D/E) of 0.42, which is about average as compared to similar companies. Thomson Reuters Corp has a current ratio of 1.48, which is within standard range for the sector. Debt can assist Thomson Reuters until it has trouble settling it off, either with new capital or with free cash flow. So, Thomson Reuters' shareholders could walk away with nothing if the company can't fulfill its legal obligations to repay debt. However, a more frequent occurrence is when companies like Thomson Reuters Corp sell additional shares at bargain prices, diluting existing shareholders. Debt, in this case, can be an excellent and much better tool for Thomson to invest in growth at high rates of return. When we think about Thomson Reuters' use of debt, we should always consider it together with cash and equity.

Thomson Reuters Total Assets Over Time

Thomson Reuters Assets Financed by Debt

The debt-to-assets ratio shows the degree to which Thomson Reuters uses debt to finance its assets. It includes both long-term and short-term borrowings maturing within one year. It also includes both tangible and intangible assets, such as goodwill.

Thomson Reuters Debt Ratio

    
  25.0   
It appears that most of the Thomson Reuters' assets are financed through equity. Typically, companies with high debt-to-asset ratios are said to be highly leveraged. The higher the ratio, the greater risk will be associated with the Thomson Reuters' operation. In addition, a high debt-to-assets ratio may indicate a low borrowing capacity of Thomson Reuters, which in turn will lower the firm's financial flexibility.

Thomson Reuters Corporate Bonds Issued

Thomson Short Long Term Debt Total

Short Long Term Debt Total

5.72 Billion

At this time, Thomson Reuters' Short and Long Term Debt Total is very stable compared to the past year.

Understaning Thomson Reuters Use of Financial Leverage

Leverage ratios show Thomson Reuters' total debt position, including all outstanding obligations. In simple terms, high financial leverage means that the cost of production, along with the day-to-day running of the business, is high. Conversely, lower financial leverage implies lower fixed cost investment in the business, which is generally considered a good sign by investors. The degree of Thomson Reuters' financial leverage can be measured in several ways, including ratios such as the debt-to-equity ratio (total debt / total equity), or the debt ratio (total debt / total assets).
Last ReportedProjected for Next Year
Short and Long Term Debt Total4.1 B5.7 B
Net Debt967 M918.6 M
Short Term Debt492.2 M677.7 M
Long Term Debt1.8 B3.7 B
Short and Long Term Debt973 M1.3 B
Long Term Debt TotalB3.5 B
Net Debt To EBITDA 0.51  0.49 
Debt To Equity 0.25  0.24 
Interest Debt Per Share 7.14  7.16 
Debt To Assets 0.17  0.25 
Long Term Debt To Capitalization 0.13  0.13 
Total Debt To Capitalization 0.20  0.34 
Debt Equity Ratio 0.25  0.24 
Debt Ratio 0.17  0.25 
Cash Flow To Debt Ratio 0.81  0.85 
Please read more on our technical analysis page.

Pair Trading with Thomson Reuters

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Thomson Reuters position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Thomson Reuters will appreciate offsetting losses from the drop in the long position's value.

Moving against Thomson Stock

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The ability to find closely correlated positions to Thomson Reuters could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Thomson Reuters when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Thomson Reuters - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Thomson Reuters Corp to buy it.
The correlation of Thomson Reuters is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Thomson Reuters moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Thomson Reuters Corp moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Thomson Reuters can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Other Information on Investing in Thomson Stock

Thomson Reuters financial ratios help investors to determine whether Thomson Stock is cheap or expensive when compared to a particular measure, such as profits or enterprise value. In other words, they help investors to determine the cost of investment in Thomson with respect to the benefits of owning Thomson Reuters security.

What is Financial Leverage?

Financial leverage is the use of borrowed money (debt) to finance the purchase of assets with the expectation that the income or capital gain from the new asset will exceed the cost of borrowing. In most cases, the debt provider will limit how much risk it is ready to take and indicate a limit on the extent of the leverage it will allow. In the case of asset-backed lending, the financial provider uses the assets as collateral until the borrower repays the loan. In the case of a cash flow loan, the general creditworthiness of the company is used to back the loan. The concept of leverage is common in the business world. It is mostly used to boost the returns on equity capital of a company, especially when the business is unable to increase its operating efficiency and returns on total investment. Because earnings on borrowing are higher than the interest payable on debt, the company's total earnings will increase, ultimately boosting stockholders' profits.

Leverage and Capital Costs

The debt to equity ratio plays a role in the working average cost of capital (WACC). The overall interest on debt represents the break-even point that must be obtained to profitability in a given venture. Thus, WACC is essentially the average interest an organization owes on the capital it has borrowed for leverage. Let's say equity represents 60% of borrowed capital, and debt is 40%. This results in a financial leverage calculation of 40/60, or 0.6667. The organization owes 10% on all equity and 5% on all debt. That means that the weighted average cost of capital is (.4)(5) + (.6)(10) - or 8%. For every $10,000 borrowed, this organization will owe $800 in interest. Profit must be higher than 8% on the project to offset the cost of interest and justify this leverage.

Benefits of Financial Leverage

Leverage provides the following benefits for companies:
  • Leverage is an essential tool a company's management can use to make the best financing and investment decisions.
  • It provides a variety of financing sources by which the firm can achieve its target earnings.
  • Leverage is also an essential technique in investing as it helps companies set a threshold for the expansion of business operations. For example, it can be used to recommend restrictions on business expansion once the projected return on additional investment is lower than the cost of debt.
By borrowing funds, the firm incurs a debt that must be paid. But, this debt is paid in small installments over a relatively long period of time. This frees funds for more immediate use in the stock market. For example, suppose a company can afford a new factory but will be left with negligible free cash. In that case, it may be better to finance the factory and spend the cash on hand on inputs, labor, or even hold a significant portion as a reserve against unforeseen circumstances.

The Risk of Financial Leverage

The most obvious and apparent risk of leverage is that if price changes unexpectedly, the leveraged position can lead to severe losses. For example, imagine a hedge fund seeded by $50 worth of investor money. The hedge fund borrows another $50 and buys an asset worth $100, leading to a leverage ratio of 2:1. For the investor, this is neither good nor bad -- until the asset price changes. If the asset price goes up 10 percent, the investor earns $10 on $50 of capital, a net gain of 20 percent, and is very pleased with the increased gains from the leverage. However, if the asset price crashes unexpectedly, say by 30 percent, the investor loses $30 on $50 of capital, suffering a 60 percent loss. In other words, the effect of leverage is to increase the volatility of returns and increase the effects of a price change on the asset to the bottom line while increasing the chance for profit as well.