An oversold TSX tech stock can be one of the best buys on the market right now. When fear takes over the market, even strong companies get punished more than they deserve. That creates rare moments when long-term investors can scoop up quality businesses at discounted prices, locking in future growth before sentiment turns around. Itâs like finding a premium product in the clearance aisle. Not because itâs broken, but because everyone else is too distracted by short-term noise to notice its value. And right now, there’s one oversold tech stock I’m watching on the TSX today.
TRI
Thomson Reuters (TSX:TRI) is one of Canadaâs global tech-enabled information giants. It provides data, software, and analytics to legal, tax, corporate, and media professionals around the world. Itâs not a flashy consumer tech name, but a mission-critical platform used by institutions that rely on accuracy and reliability every day. The tech stock has been evolving aggressively toward cloud-based tools, artificial intelligence (AI)-powered research, and subscription software products that generate recurring revenue. That transformation has created a business that is steadier, more scalable, and more profitable than it was a decade ago.
Yet there’s even more. TRI offers global diversification and deep customer relationships. Its clients arenât the type to switch platforms on a whim. Law firms, tax specialists, and financial institutions embed Thomson Reuters tools directly into their workflows. That stickiness provides long-term revenue visibility and supports steady cash flow growth. For investors looking for a dependable, globally recognized Canadian tech company, TRI brings stability and modernization in one package.
Into earnings
In its most recent earnings, Thomson Reuters posted revenue growth supported by continued expansion in its legal and tax segments. This was on top of rising demand for its cloud and AI-enhanced products. Operating profitability improved as the tech stock scaled software revenues and continued its transformation program. This includes cost efficiencies and product consolidation. Subscription-based revenue remained strong, giving analysts confidence in the durability of future earnings.
Management also raised guidance for full-year results, signalling confidence in continued momentum. Free cash flow stayed healthy, allowing the tech stock to continue funding dividends, share buybacks, and strategic investments in AI capabilities. Even with currency impacts and some uneven performance across smaller divisions, the core business demonstrated the kind of resilience investors expect from a mature tech-enabled platform.
Foolish takeaway
TRI now looks like an oversold TSX tech stock that could be a solid buy. Its recent pullback doesnât reflect the underlying strength of its business or the long-term potential of its AI-driven transition. Investors have focused heavily on short-term market volatility and macro uncertainty, pushing the share price down. That’s despite TRI continuing to grow recurring revenue, expand margins, and maintain high customer retention. When sentiment is this disconnected from fundamentals, long-term buyers often have an opportunity.
What makes TRI especially compelling right now is its combination of defensive characteristics and tech-driven upside. It offers the stability of a global information provider with consistent cash flow and a reliable dividend — all while investing aggressively in AI tools that can unlock new growth over the coming years. For investors looking for a high-quality Canadian tech name thatâs temporarily out of favour, TRI fits the profile of an oversold stock with durable long-term potential.
The post 1 Oversold TSX Tech Stock Down 23% to Buy Now appeared first on The Motley Fool Canada.
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Fool contributor Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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