Operator: Thank you. And our next question today comes from Manav Patnaik with Barclays. Please go ahead.
Manav Patnaik: Yes. Thank you. I just had a question on mortgage plus pricing. I guess the down 15% in the first half that just seems like kind of continuation of what you saw in the fourth quarter. Just wanted to confirm the plus 10% in the second half, was that purely comp? So is there some other assumption you’ve made in there? And then I think in your prepared remarks, you said pricing going up from your own and third-party. I think we know the third-party, but just wanted some more clarity on where your pricing is going up and how much.
Todd Cello: Hey, Manav, this is Todd. Can you hear me okay?
Manav Patnaik: I can hear you. Now it’s a little muffled while you’re talking, but right now I heard you fine.
Todd Cello: Okay. Great. So I’m going to – I’ll speak louder. So as far as the assumptions that we have pertaining to our volumes, we are assuming that we’re going to grow – we’re going to be down 10% in the first half, but up 15% in the second half, I’m just reiterating, and then down 5% for the full year. The assumption is just purely on the comparisons in the second half of the year, there’s no – we’re not banking on any type of recovery in mortgage. It’s more kind of the same, right? And just to provide a little bit more context on that, when we build our assumptions for mortgage, we’re looking at this across multi-dimensions, the first being our own team and what they’re seeing in the market, the second being our mortgage advisory board.
And this is where we’re hearing directly from our customers as it pertains to what their expectations are. And then the third area is where we look at outside data sources just like you do, so for example, the Mortgage Bankers Association. So you take those three elements and that’s how we come up with our guide. The second part was…
Chris Cartwright: Yes, the second part was about the pricing. I’ll wait here, because I didn’t hear it. I mean, obviously, Manav, as you well know, third-party pricing is the biggest driver of price increases in mortgage and has been for the last couple of years. Our comment about our own pricing, you should think of it as more or less consistent with our annual pricing practices. And then again, as we all know, if the Fed were to lower rates mortgage volumes is probably the first area where we would see some uptick.
Operator: Thank you. And our next question today, excuse me, comes from Owen Lau with Oppenheimer. Please go ahead.
Owen Lau: Hey, good morning. Thank you for taking my question. Can you please go back to your rate cut assumption? Are you assuming no rate cut currently? I mean, if there are three rate cuts as the Fed is projecting right now or even more than three, just like what the market is pricing in. How should we think about the incremental benefit in rent and also EPS in 2024? Thank you.
Todd Cello: Yes. Owen, as it pertains to our interest rate assumption, we are not assuming that the business gives any benefit from interest rate cuts. So think of that as if the interest rates come and there is an uptick in lending, that would all be upside to the guidance that we provided this morning.
Chris Cartwright: Yes. Look, this is an opportunity, I think, for us to just provide some context and clarification on the nature of the guidance 3% to 5% organic. Clearly, Todd and I feel the odds are more towards the high end of that range. And again, we wanted to be conservative given the environment in which we’re operating, we’re not modeling in volume increases due to rate cuts, that would all be upside. And we’re steering the business towards what we hope will be outperformance.
Operator: Thank you. And our next question today comes from Andrew Nicholas with William Blair. Please go ahead.
Andrew Nicholas: Hi good morning. Thank you for taking my question. I just wanted to ask on Neustar margins specifically, I think you guided to 32% this year, historically, or I guess previously, you talked about a 40% margin target. Just wondering kind of if that’s still within the realm of expectations over the medium term? What will it take to get up to that level, recognizing that you’ve already gotten the $80 million plus of cost savings in the run rate? Just an update there would be helpful. Thank you.
Chris Cartwright: Yes, for sure. So the guide to Neustar margins getting to the level of the full enterprise, at least to peak margin performance was more in the context of a four- to five-year period, right? We’ve had two years of ownership. We’ve added 1,000 basis points. We’re headed toward 32% this year. And while we’ve achieved the $80 million in cost reductions, look, we think there’s more juice in the squeeze, so to speak. We’re not formalizing yet. We’re not guiding to it. The other factor that’s going to give us material margin upside is as the revenue growth rate increases in Neustar, assuming we start to enjoy flattish market conditions on the marketing side, and get some uplift on the risk side through all of the innovation that we’ve done with our fraud mitigation suite, we’re going to get higher flow-through that’s going to help drive margins up to that initial post-acquisition guide.
Aaron Hoffman: Great. And that brings us to the end of the call today as we’re bumping up towards the top of the hour now, a very busy day of earnings for everyone. So, I want to thank you for your time today and wish everybody a good rest of the day. Thank you very much.
Operator: Thank you. This concludes today’s conference call. We thank you all for attending today’s presentation. You may now disconnect your lines, and have a wonderful day.
