We’re seeing demand in corporate and class actions. We’re seeing demand around helping people process alternatives. So lots of things that are meeting some important needs that our clients have. So as I said, we now have clients – multiple clients live with at least one component and others in implementation. I think that shows that component approach is working. As you said, we are targeting $20 million to $30 million in incremental sales, and I think we’re on track to achieve that over time. So I think when you look at how we’re looking about our wealth strategy, we’re really assuming mostly these component sales within every few years, something a little bit larger that will boost sales in that year. But I think right now we’re focused on the component side.
Peter Heckmann: Okay. Okay, that makes sense. And then just I didn’t hear you reference it. And certainly historically, Broadridge has been pretty active on M&A. But now with leverage back down below 2.5%, how do you view the M&A pipeline? And do you think we could still see a deal or two happen in fiscal 2024?
Tim Gokey: Yes, it is. I think if you look at the market there’s still a disconnect between buyers and sellers in terms of what the values are. So the landscape in terms of what is available is a little light, I would say. There are some interesting things that we are looking at. So I wouldn’t be surprised if we’re able to transact something in 2024. But the degree of pipeline and activity is definitely way below where it was a few years ago. I think one of the things, Peter, is that with the investments that we’ve made, we’re feeling really good about our ability to drive organic growth through organic investment. And so that balance between organic growth and M&A that may be a little bit different over the next few years than it was in past. But we will continue to look for the right opportunities that meet our criteria.
Peter Heckmann: All right. That’s helpful, Tim. I appreciate it.
Operator: The next question is from Darrin Peller of Wolfe Research. Please go ahead.
Darrin Peller: Hey, guys. Thanks. Maybe we could jump in a little more to the components of the business, maybe just touching first on the communication side. I just want to make sure we understand. I know we saw strong growth in digital offset by slowing print. If you could just give us a little bit of an update on some of the additional color on print trends, sustainability of it and just broadly speaking, that’s a segment that is one that’s shown us some element of improvement obviously, since you – really, since you closed the deal, but it took a little while at first. So just give us a little more color on what you’re seeing there first, please.
Tim Gokey: Sure. Darrin, thank you very much. Thank you for that question. We really liked this quarter because we’re now beginning to see that conversion of print to digital that we’ve been talking about. So this quarter we had a significant client that went live on our next-generation digital solution and moved a lot of communications from print to digital. So they saved a ton of money, and their end clients and advisors are really happy with the new solution and are very engaged with it and seeing real upticks in satisfaction. So on the base of that, we saw lower print volumes on that client, but overall, we saw a double digit increase in our digital revenues and a double digit increase in profitability. So that really shows how this transition can work for us.
So I do think – just stepping back a little bit, our main story is that continued flow towards digital. But I do have to put an asterisk on it, which is that we are continuing to see a lot of demand from companies that are seeking to rationalize their print facilities. And so there still is an opportunity sort of in that midterm to be the consolidation point for print, which we’ll do and are happy to do as long as the digital comes with it so we get the transition over time. So longer term, we expect to see lower growth in print, with strong growth in digital and strong profitability growth, which is exactly what we saw in the first quarter. But there will be some bumps along the way where we have stronger print volume.
Edmund Reese: And then in the mean – and I’ll just add, Darrin, you made a point in your question is worth highlighting that since the acquisition, we’ve continued to see margins expanding and low double-digit earnings growth as we execute on this strategy for print to digital that Tim just talked about. So we feel very good about that.
Darrin Peller: Quick follow-up just on the positional growth side, specifically on mutual fund, but maybe more – first more, just more broadly what you’re seeing and what you’re expecting on trends. You guys tend to have a lot of really good data as you always say, in terms of at least the next six months. So just remind us your conviction on what you’re seeing now on that front broadly. But then specifically mutual funds, I think, were 3%, I think you said driven by passive – and so – if you could just add color on active mutual fund position trends here broadly and just couple that into the first question on overall position growth.
Tim Gokey: Yes, Darrin. Look, I think that the underlying trends on both numbers, both the equity side and the fund side are positive. And as we’ve talked about, that includes growth in managed accounts and then over time, things like direct indexing and pass-through voting. And we were certainly happy with the 8% record growth, which I know wasn’t your question about what it was, but I have to repeat it. And that was really driven by the managed account side. On the fund side, where it was 3%, we have seen that be a little bit noisier quarter-to-quarter based on timing, and that is really what we think was going on this quarter. Sort of looking inside that, it’s – there’s good growth in money market funds, not surprisingly given sort of the volatility that is out there.
