Broadridge Financial Solutions, Inc. (BR) Earnings Call Transcript & Summary

All right. I guess welcome to the conference. This is really the beginning of 3 exciting days here in Key Biscayne, Florida. I'm Alex Kramm, senior research analyst at UBS, covering exchanges and business services. Excited to start the conference on with the new participant, Broadridge, I think has never been to this conference, at least you haven't been here, Tim. So why don't we just get started with Tim Gokey, Chief Executive Officer of Broadridge.

So look, as I just said, you've never been to this conference personally before. So for everyone's benefit in the room here, just to get us started on an easy note, why don't you just remind everybody what Broadridge is all about and why we should be excited about the company?

Yes. First of all, Alex, thank you very much for having us. It is our first time here and an amusing thing, we -- not knowing where the conference was, we were here with our family for a week over Christmas at this hotel. So it's funny to be back and it's great. I'm really excited to be here today because there is so much change going on in financial services right now. And we think that Broadridge is uniquely positioned to help drive innovation at scale for our industry. We sit at the intersection of capital markets, wealth management, asset management and corporate issuers. And if I go back to when I joined the company in 2010, we had 3,000 associates, about $2.5 billion market cap. Today, we're 15,000 associates, $22 billion market cap depending on which hour you look at. And that's all been around -- all that scaling has been around driving innovation at the intersection of a couple of big trends, the democratization of investing, the acceleration of trading. And so today, we're a technology and market infrastructure provider that $4.5 billion recurring fee revenues. And just to give an example of that, we process $15 trillion of trades every day. In the tokenized assets, we process $400 billion a day. On the government side, we process 1.5 billion shareholder positions across 150 million accounts. We serve 28 of the 29 globally significant financial institutions. So that gives us a really unique sort of complex functional knowledge and network connectivity that really suits us well to drive change. And I just have to talk about a couple of the things that we're investing in, and we'll do your questions, but it's -- there's so much change going on in financial services right now with a really pro-innovation regulatory agenda, with a lot of technology change. And so it's creating change across 3 areas that we're investing in: Democratization investing, shareholder engagement and AI. And those are -- and acceleration of trading, I can't forget that one. So if we think about just stepping into each of those for a moment, you look at the democratization of trading has been a trend for a long time. We see 3 exciting things happening right now. Tokenization, we think it's going to develop over time, but we're really well positioned to help our clients with that. And we think it's going to be a nice driver of physician growth over time. Shareholder engagement. The way public companies and funds are beginning to engage with their shareholders and the retail shareholders, very different. We're helping them with that. And then digitization of communications where it's already 90% on the regulatory side, but our tools are making it even more powerful. So we really like what's happening there. Acceleration of trading, very similar in terms of the opportunity. It's getting faster trading, narrower spreads, more markets, more products, really creating demand for what we do. And now as you think about the tokenization of that where we're a leader, we can take that to the next level. And finally, AI, we have more powerful uses of data, bringing in agentic, bringing in coding tools, we think that's a real opportunity for us. It's obviously been sort of bespoke to the market over the past few months, but we think we're really differentiated from the typical SaaS player that is overlaying sort of workflow on top of their own data whereas what we're doing is core market infrastructure. We're moving money, we're moving securities, we're moving votes, we're competing in operational resilience. It's a vast network, and it's really hard for one person to replace that. And on the converse, the upside of that is the ability to really go after the white space in our market. We talk about a $60 billion market that we manage. That's the vended side. Unvended is another $160 billion. And so being able to go after that like with what we've done with Wells Fargo, JPMorgan, ExxonMobil, just recently, to name a few. So we really like that opportunity. And of course, we're using it internally. And that's all in a financial model that is very simple 5% to 7% growth organic, 1 to 2 points of M&A for a 7% to 9% recurring revenue growth. With the operating leverage of being a technology company, grow -- earnings 10%, 8% to 12% is our guidance, buyback a point of shares, pay a 2% dividend, deliver low teens to shareholders for a long time. So we take that financial model, the ability to reinvest and the ability to really help our clients drive change and mutualize change. It's an exciting place to be.

Well, I think there's a lot to unpack here.

Exactly.

So let's start with the regulatory side, which is obviously still the core of the business, the regulatory communications side. So one of the things you're talking about, the long-term outlook is position growth in that mid- to high single digits. I don't think you just mentioned it, but maybe just talk about that for a second. What gives you confidence in what and both the long-term outlook there and that, that can actually continue?

Yes. I think -- so a core part of our business, regulatory communications and so position growth is the main driver of our economics there. And it's not -- if you look at the sort of contribution to the growth of our whole company, this is a part of it. It's not the whole thing, but it's an important part. And we always talk about position growth in the high single digits. And that has been -- basically it's been where it's been for literally the past few decades. And the reason it's been that way is just constant innovation in financial services. So if you go back 15 years ago, it was the advent of ETFs. If you go back 10 years ago, it's a real growth of managed accounts, and that's still going. If you looked 5 years ago, it was free trading. If you look right now, we're seeing significant growth in direct indexing and if we look ahead, you think about the potential impact of tokenization. So that continued innovation is what gives us confidence. If we look right now in the very near term, we have a good ability to test forward over the next few months. And we're seeing a continuation of that same thing.

So nothing on the near term -- I guess, we jumped ahead a little bit. But like anything on the near term, given some of the volatility, it seems like retail is resilient, seems like you're still pretty comfortable with what you're seeing out there?

Yes. It's interesting when you see market volatility and market pullbacks and stuff in terms of how that affects our business, we tend to be a very lagging indicator and it tends -- if there is an impact, it tends to happen way after the fact, if there's an impact. It is -- right now, what we're seeing is retail investors are sort of buying in on the dips. So we've always talked about this testing, but what we do is we pulled the positions today that we're going to be communicating with 6 weeks from now. And that doesn't change that much. So we have really good visibility into the season right now.

Okay. And then outside of the macro drivers, you mentioned already in your -- in the first answer, the quiet revolution. I think you call it on the investor communications side, so I did ask about this on the earnings call, and you made a comment that there's a variety of new initiatives, but that overall, I think you mentioned could maybe add a point to your growth over time. I think you mentioned maybe even a couple of hundred million dollars was the number. So maybe just flush it out a little bit. Any particular chunky solutions we should be thinking about? Because it always sounds great when it's like, oh, it's the percent, it's a few hundred million, but obviously, I assume the teams looking at more detail than that.

Yes. There are -- what we're going after is some things that have been sort of issues and topics for the past several years, and we're bringing technology to solve those. And sort of different -- different client segments have different issues. So for the large path of asset managers, they are very concerned that -- there is a concern that they have too much voting power. And so they're trying to -- they're trying to distribute that to their underlying shareholders with pass-through voting. And that's been a big growth area. We've gone from 100 funds to 400 funds, 600 funds this year, $4 trillion under management. It's not huge economically, but it really positions us well. And the real thing there is going to be how do we make it -- we're still not there yet, how to make the interface easy enough that there's really good uptake amongst investors. But a lot of innovative ideas on that. The second chunk is that asset managers are -- they just don't like the -- having only the choice of ISS and Glass Lewis around how to do their voting. And so we've been approached by a number of those. We're driving using AI, clean data, giving them a policy engine, allowing them to do their own votes. That could be a really nice chunky growth area for us. And we're doing that with three significant clients this year -- 3 Tier 1 clients, and we see a lot more of that next year. And then the third area is standing instructions for public companies. We're doing that with ExxonMobil. We'll do sort of a beta this year with about 6 companies, allowing investors to set a default because retail investors tend to want to vote with management. If they don't like management, they sell the company. And so they really like that. This could also be a really chunky business. It's pretty new, but it could be pretty chunky. So collectively, just ISS and Glass Lewis, that's a multi-hundred million dollar market by itself. The standing instructions, hard to say how big that could be, but it could also be substantial. So if we think about building a business more than $100 million over the next few years, that's where I get the point. And it's not on the whole company, it's on the governance business.

Perfect. And then maybe to touch on the other side of that. I mean, you just mentioned the proxy advisers, and there's been a lot of scrutiny even from the administration, so just given that you're a little bit ancillary to that business, and I think sometimes investors don't really understand where you are relative to those guys. What is the risk that you get caught up in this whole regulatory focus as well.

Yes. Great question. Thank you for asking because I think you hear the word proxy and it's like, what was that? So we just don't see any appetite at the SEC for a review of sort of the underlying voting technology or the pricing around proxy. Obviously, everyone wants it to be less expensive, that's their job, but we're just -- there's just no momentum around that if you look at the public agenda of the SEC. What is on the SEC's agenda and it's really clear, Chair Atkins has said it multiple times. It's tokenization and digital assets, and we've talked a little bit about that. We are really helping there. And we think we can make a big difference in bringing governance to that. It is -- we always talked about making IPOs and public companies great again. And that's where you hear some of the proxy stuff inside that. But it's much more around making it harder for people to put forward proposals. Our economics are not geared on the number of proposals. It's about simplifying some of the disclosures, the length of the proxies, some of the things that are inside there, again, doesn't touch our economics. Even if they move to semiannual reporting, which I don't think is going to happen, but that doesn't touch our economics. So those are all things that sort of sound like they're in the space that they're really oriented as something else. And in fact, we're really helping with that -- with what we're doing with ISS and Glass Lewis and sort of creating an alternative to that, which people really like. And then the last piece of this agenda is making private assets more available to people. We're not as geared on the private asset space, but we are helping wealth managers with that. And as private assets move from just high net worth investors to broader investors, it does raise the question which I'm not claiming as an opportunity yet, but it raises the question, should there be more disclosure? And could that be a future opportunity. So when we look at how the agenda is lined up, we see it much more as an opportunity than a set.

We definitely think there will be more disclosure needed as you broaden access to private markets. Switching over to the GTO side for a minute and maybe just starting with Capital Markets. I'll keep this broad, but a lot going on in that business all the time. So maybe just anything that you're excited about in the near and long term here?

Yes. I think -- so near term, we announced the acquisition on Friday of CQG. CQG does execution management, especially in futures and options. We don't really play in the execution management space today. And we're building in futures and options. We have one core client, we're building up from that. So it really strengthens in both dimensions there. That was about $170 million purchase and we think that will -- not necessarily this year because it's going to close later in the year, but you think about its addition to the capital markets business is about 5 points of growth. So that's a nice exciting thing. If I think medium term, we always talk about the simplification that we bring to platforms, both on the front office side where many clients who go and look, and they have 30 different front office trading platforms and bringing that together on a single multi-asset class platform is a great simplification opportunity for them. Similarly, in the back office where their infrastructure has been built up asset class by asset class, region by region and simplifying that onto a global multi-asset class platform. That continues to be something that has a lot of room to run. And then if we think about longer term, we really like what we're doing in the tokenized trading space, again, leading with digital ledger repo, the $400 billion a day that I've talked about, but we have a nice road map on that if we look forward around bringing in real time, moving to new asset classes and so we always talk about simplification and innovation in terms of our capital market strategy, and you can just really see how that plays out.

Okay. Staying on GTO, but moving to the wealth side, which is the other part of that business, generally an area that -- and it's not just because I represent this firm, but clearly, an area that we're excited about. But look, what are you doing in that area? Are you going to be able to participate to the -- in the growth in wealth? And anything again that gets you excited near or medium term?

Yes. We are -- in wealth, we're focused on making advisers more productive, making the end investor experience better and on digitizing all the operations. And as you know, we have invested pretty heavily in a platform that is componentized. It's sort of the more you have, the better it works, but you can take any of the components that allows people to modernize really sort of on their own pace. We have -- we announced multiple sales of that last year. So we have a nice organic growth in this business. And when you think about the component side, we have -- of those, we have about 48 components are installed live at clients. We have another 40-some that are in -- currently in implementation. We just won a number of industry awards. So we like the momentum. We like the story here. And it's a long-term story in helping firms with their modernization road map.

Good. All right. I want to kind of take it back to the bigger picture a little bit and maybe get even a little bit more into the numbers. But sales activity is an important metric that we all track. Second quarter, I think, was a nice boost year-over-year. But I think year-to-date, you're still lagging a little bit if I look at last year, and the guidance for the year. So just talk about maybe the pipeline, what you're seeing and what gives you confidence that we're going to reach that number this year.

Yes. So first of all, just for those that aren't as familiar, when we think about sales for us, it's sort of a bookings measure. It's sort of stuff goes into a bucket and then we implement out of that bucket. So if you look at sort of near-term revenue, it's much more about the pace of implementation out of the bucket. So we talk about the backlog that we have at the end of each year. Last year it was $430 million at the end, and that's where we're getting our near-term revenue. So sales can go up and down, it doesn't really affect our near-term growth, obviously affects our long-term growth. And then we tend to be pretty seasonal in our sales and do a lot more in the second half than in the first half. But as you rightly point out, we're a little bit behind where we were last year at this time. So we've done about $89 million in the first half. And as I said on the call last week, we have a lot of wood to chop. So what makes us optimistic about that, a couple of things. When you look at the new originations, which is an important measure that we look at, our new originations in the first half this year were up 20% over last year. The other thing we look at is pipeline multiplier. So if I look at all the things in our pipeline that have a date where the -- it's expected to close sort of in this fiscal year. Now by the way, if you added up all the stuff that's expected to close this fiscal year, we blow past our sales numbers. But institutions always -- there's always like a little complication and things get delayed a little bit. And so there's always a percentage that happens. But if you look at the multiplier of the ratio of that compared to where it was last year, it's much healthier. So those are a couple of things that are -- that give us optimism. The other thing I really like is where we're originating, where we're in conversations is these areas where we're investing, whether that is digital communications, the platform, the tokenization topic, the shareholder engagement topic. And so we have really healthy client conversations around all of those. So those are the opportunities, we are seeing some good momentum in the second quarter. I don't go so much by quarterly results as much. It's just sort of looking at the whole year, but that's where we come out on the $290 million to $330 million.

Okay. You just mentioned tokenization again. I think we've come up a couple of times already. So maybe we'll need to dig a little bit deeper if -- look, I think it's going to be a big topic at this conference for sure. So yes, can you talk a little bit more about the opportunities, but then also about the risks that, again, I think, been a focus for investors here over the last few days, weeks or maybe even months already. So yes, and then specifically on the opportunity side, you have the repo product out there. I think it's on a -- it's on a private chain now or ledger now. I think you're going to move that public. So can you just talk about when that's going to happen, what that could mean? And then, of course, other initiatives around that and potentially other asset classes?

Yes.

The big question, I know it's a -- it's a lot going on, but...

There's a lot going on. And who knows what the market is concerned about this tokenization or if it's software or what it is because it's really -- this is where you get the big bucks for figuring that out, but let's start with where people have some concern, which is on the governance side, and is there some way that this could disintermediate Broadridge. And I just want to be really clear here, which is we think that this is absolutely an opportunity, not a risk for us. And say that again, we think this is absolutely an opportunity. And why is that? If you think about, first of all, tokenized securities, with the SEC, they've consistently talked about the fact that the tokenize security is still a security. So all of the different requirements that traditional securities have to have -- we expect tokenized securities have including everything around governance. And then you really look at, well, where will these be purchased. And we believe overwhelmingly, they're going to be purchased with traditional wealth managers or the digital exchanges like the Coinbases and the Krakens of the world. And all of these are our clients. And those intermediaries are going to have all of the same asset servicing obligations that they have today. And that includes proxy and class actions and corporate actions and tax and all the complexity around that, that they need to address. And that's what we do, and they are our clients. So people talk about, well, what about issuers having direct access to those clients. In the end, intermediaries are not going to give up the names of their clients to funds and public companies. They're just not going to do it. And investors want the choice around that privacy. So we don't think issuers are going to have that direct access. Now if I go and buy my shares directly from Exxon or directly from Apple or directly from Microsoft or pick your public company then they'd have direct access. But that's a hugely clunky model. When you think about at scale, is that what's really going to happen? No, it's going to go through intermediaries. So we think, conversely, what's going to happen is it will go to intermediaries. It will bring in new investors, new products, new sources of demand, the digital changes will grow, and that will all be a nice contributor to position growth in the future and a nice tailwind for Broadridge.

Excellent.

Oh, DLR. And the capital market side, yes. So that's the governance side. Then we go to sort of the platform side of things, where we have been a leader. If you went to Davos 10 years ago, every street sign and every billboard and everything would have been all about blockchain. And then it sort of went away and got quiet. But we never stopped investing in that. And so we started with repo because 60% of fixed income in North America is on our technology platform, and we're looking for where is a use case where we can help our clients make money. We can make the money, not go broke. And so we started with repo, with internal -- intra-institution repo. UBS is a user of that. And that enables clients to save money right now without a big complex network. That had grown to about $100 billion a day up to sort of this time last year. And since then, with the market awareness, with treasury clearing coming up, which is a great new use case for sponsored repo and the new administration that's grown from $100 billion to $400 billion a day, a bunch of new clients signing up. It continues to grow. And so that's a nice use case. As you say, right now, we started with that in a private version of Canton, which is one of very financial services-oriented, institutional trading-oriented networks that is out there. That we will bring to the public version of Canton. They're doing some work on it. They have a statement of work with DTCC to really make it sort of fully ready for prime time. So that will happen later on this calendar year. That will create a lot more interoperability for bilateral repo. In the meantime, we're bringing it real time. And you think about the way repo works are not today, it's overnight. It's sort of a treasury function. Think about the future where it can be real-time atomic settlement. It can be right on the trading desk financing trades as you go. And really the volume differential there could be really nice and really create something that would really help the whole daylight overdraft situation and that exists today. So we really like that, but this is a multi-asset class platform. We already announced in Q2 that we helped Societe Generale issue its first natively digital bond, corporate bond, and we can do that with others. We're also talking to institutions about tokenizing deposits. So we see a really nice road map of growing real time, much more interoperability, other asset classes. And we think the experience of doing it at scale, which we've been doing versus experiments is -- gives us a really nice edge in this.

Good. Staying on new technologies. And I think you, again, mentioned it at the beginning already, AI, which again, will be a huge topic at this conference across, I think, the whole -- all of the subsectors. But look, I think starting with what you're doing, maybe give us a refresher of where you're doing -- using it internally, maybe for cost purposes, but also obviously, where can it help grow the business? And then, again, just looking at the last couple of weeks again in parts of my coverage and financials broadly, clearly, investors are focused on the disruption from AI again software data, workflows, I mean, some people think everything is changing, obviously. So how are you positioned against that potential disruption that a lot of people are trying to price in right now?

Yes. Obviously, we think it's more of an opportunity than a disruption. And probably every company that comes up here today is going to say that, but let me just talk a little bit about what I think differentiates us from sort of some of the traditional SaaS players, where what they're essentially doing is giving you access to your own data, giving you a nice user interface, giving some workflow on top of that to manage your sales force to do your HR picture what you're doing. And as I said before, I think we're very differentiated from that because they're really core market infrastructure, connecting all the institutions and the trading venues and the depositories, moving money, moving securities, moving votes and something that is -- requires that many firms interact with each other with strong regulatory requirements. And we're making an error can -- would be many, many times our fees, 1 error. So that really makes it different. I mean, look, we've looked at our own -- all the software that we purchased ourselves. And we can look at applications. We say, yes, we can internalize that. And we look at like, okay, our Oracle Financials. We're not going to internalize that, right? And it's the same kind of thing. So we just don't see the vast majority of what we do is have this broad network quality. That's just very different. Conversely, we do see real opportunity. When we look at the ways we've already been able to generate new revenue by doing new things for clients. So what are some examples. We have a data and analytics business that serves the asset management industry. And that has always been and it's a really beautiful business. We have great data around who is buying what and what channels, both retail and institutional globally. It's always been descriptive. With AI, we've been able to make it predictive to say what's going to happen. And that has been -- I won't say it's flying off the shelves, but we sold on those 20 clients in 18 months since we introduced it. What we're doing, we've announced with Wells Fargo and others around proximity. That is a natively AI custom policy engine. Again, it's applying AI to do something really nice growth trajectory there. The -- if you -- next time you get -- pardon me, let me get an annual -- an e-mail with an annual, semiannual report from a fund, take a look at it, there's going to be a picture of the report on there that you can just click on. I know that sounds a bit trivial, but until 6 months ago, it was a link. It was very disengaging because no one ever clicked through to a link. Now you can see the document right there. Investor engagement is up 10x. While keeping track of all those documents in source and making sure they have the right one is we're using AI to do that. So with AI, we were able to do that. It's not a pure direct revenue, but it's a great client enhancement. So those are just some examples. We're already -- we're driving revenue for better client experience with AI. Looking at the cost side, there was an announcement by Goldman on Friday about using AI on there -- it wasn't on their technologies, under operations to make their operations more efficient. We're already doing that. We're more way more levered towards technology, but we do have a business we serve about 40 clients doing their back office operations. We have about 1,000 people doing that. It's about a $100 million business. We've improved productivity, they are 20% in the last year. We have a clear road map on the next 20%. We're sharing that with clients. And we think that's actually -- the very biggest firms can do that themselves. A lot of midsized firms would really love to mutualize the ability to invest and using the AI to do that. So we think that's actually going to be a nice growth opportunity for us there. So obviously, deploying agentic inside Broadridge will be -- we're deploying the new coding tools inside Broadridge. That is allowing us to be more cost effective to drive margins while still reinvesting and all the growth opportunities I talked about.

Well, since you just finished that topic on cost and expense opportunities, I know your CFO isn't here today, but maybe you can talk a little bit more broader around how you view investing and margin expansion in the business. From my perspective, I look at the peers, if it's the right peer group, and some of those have significantly higher margins. So I know some of these businesses are different, but maybe just talk about where maybe margins could go over time or why they are where they are given your business profile?

Yes. Thank you. Great question. So if you look at Broadridge and you look at it, there's 20% operating income margin and you compare that to other fintech and you say, like, what's going on? And so let me just unpack that a little bit. First of all, we have a significant chunk of pass-through revenue. I wish we could report that sort of separately. And I always encourage people that are following us to sort of do the analysis and you exclude all the distribution. When you do that, our margin is about 30%. That's still 10 points lower than a lot of our competitors, but it just helps you put it a little more in the ballpark. And then we have a pretty different growth strategy than a lot of our competitors. We have a lot of competitors that are -- have a sort of a lock people in and grow revenue with price and then do M&A. And we are much more of an organic growth company where we're investing in solutions. We have organic growth, if you look at price as a contribution to growth, it's almost -- is like flat. It's really much more around reinvesting to do the next thing for clients. We view every client as a 99-year client. And all of our growth comes from having very satisfied clients. If you look at our Net Promoter Scores on our core solutions, over 60. So really satisfied clients that want to do the next thing with us. And we think that that's a superior long-term growth model for investors. Now there is lots of room to grow margins, and we've been growing them over the past many years of approximately 50 basis points a year. There are some adjustments in there when postage costs go up. It's a direct pass-through, and it deprecates what is reported as our operating margin. Similarly, when interest rates move, it changes above the line, but it's compensated below the line on our variable rate debt. So we'd give you what those adjustments are. So you sort of have to think about that as well. But I think that we have lots of room as we scale the company to continue to invest, to continue to grow margins and to deliver great returns for shareholders. And just as a reminder, we really think about growing earnings, not necessarily about managing the margin. And so what we're managing the company to is that 10% sort of mid-case earnings growth.

Great. And then maybe finally, as I look at the time here, let's finish on capital allocation. You are an active acquirer, and thanks for the additional disclosures just now about the deal from last week. But look, you still have a lot of capacity. So maybe help us think about what else you can do, what your appetite is, any holes in the offering where you're spending a lot of time. So yes, what's -- in a year that a lot of people are looking for more M&A across sectors, where is Broadridge going to fit in?

Yes. I think the thing we always talk about balanced capital allocation. You'll hear is balanced capital allocation, balanced capital allocation, balanced capital allocation, which is a little bit boring, but I think it's -- that's superior for investors. And so that's being investment grade, it is making the internal investments that make sense, paying a good dividend. And then with the extra of that, doing M&A when it makes sense, tuck-in M&A and buying back shares. And over the past 10 years, if you look at that and that -- those last 2 buckets, it's been about 50-50 between those. We have a lot of cash flow right now. So we have a lot of capacity to do both M&A and to buy back shares, but the tuck-in M&A has been a very successful strategy for us. We track every transaction going back the past 15 years and we're delivering unlevered IRRs of between 18% and 20%, which you put a little bit of leverage on that if you're a PE firm, that would be a great track record. So we really like that. We really look for areas where we're the right owner, where the synergies with us, make us the right person to win. We look at 100 opportunities a year. About half the things we've done have had a proprietary dimension to the CQG transaction we just did, totally proprietary transaction. So we look for those areas where we have an edge because it does matter that you buy it cost-effectively to do well at this. And so we like that. We've done a couple of small tuck-ins this year. Looking out at where there are opportunities, there are a number of opportunities that are out there. We'll see how it plays out. Obviously, with the environment going where it is, it's really interesting how -- what will happen to valuations for things that are in the M&A market. But in the end, it's going to come back to balanced capital allocation. And if we do, do something, it's because we're the right owner, but we're very happy to buy back our shares. And obviously, they are incrementally a lot more attractive now than they were 6 months ago. And so if we're a buyer, we'll be happy with that, too.

Excellent. All right. We do have three more minutes. If we have a mic in the room, I believe we do. If there's any live questions, this will be the time. I know this is the first meeting of the day. Everybody is still just waking up. I think you can also use the app, but we'll do that some other time. Maybe just for my -- we talked about the sales pipeline earlier and the comfort level with it. Maybe you can just -- any more detail you can impact there because, again, you sometimes talk about the sales more holistically, but there are different businesses. So maybe just talk a little bit more about where you're actually seeing the most demand?

Well, I think the -- coming back to the really strategic sort of kinds of conversations we're having, having a good conversation with people about their communications infrastructure, whereas things are going more digital, they have physical infrastructure and what are they going to do with it? And how can we help them rationalize that, take it over, rationalize it and move it digital. And so there's a good set of conversations on that team. This standing instructions for public companies. There are -- after Exxon announced that they did, we literally have 100 companies coming to us saying, "can we get in on this?" So lots of great conversations there. Lots of great conversation with asset managers around the custom policy engine. So -- and then always ongoing conversations around our back-office platform. So I think if we just look at the areas where we're investing, that's where we're seeing the conversations. It does sort of spread across our portfolio. So it's hard to sort of say, oh, Alex is like this area is the one that's going to do it. But I like that. The other thing I like about that is it's very -- when you have a portfolio approach, you end up with sort of more balanced results. And I think that's what we're going to see.

Okay. No, that's very fair. Last chance for the room. Otherwise, I'm going to call it. All right. Why don't you help me thank Tim for being here today. Thank you very much.

Thanks. Great. Thank you.