UBS Analyst Cuts Thomson Reuters' Price Target

Thomson Reuters Corp. (TRI) investors should hold off for the time being, says UBS analyst Jeffrey Fan, on expectations that the company's Markets division will see dwindling revenues starting in the fourth quarter.

In a note to clients, Mr. Fan said:

Amid a deteriorating economic environment, we now assume an - 8.5% drop in Markets revenues over 2009 - 11(vs. - 5% before).

Along with adjustments to Markets cost base and additional restructuring charges, our 2011 earnings per share estimate is downgraded 19% putting us 20-25% below consensus.

Mr. Fan added that while Thomson Reuters Q2 results are expected to be solid, the outlook, which bears significant downside risk, is the key for investors.  He reiterated his "sell" rating and cut his price target from C$33 to C$28 .