Petershill (PHP) reported a Q1-23 double digit % headline miss on FRE/DE mostly driven by cyclical factors. However, fundraising was resilient including more closings after quarter end and PHP reiterated FY2023 guidance ($220-250m FRE). We remain outperform, 250p target price. Weakness on headline earnings amid a muted industry backdrop Private markets are being tested in 2023 with private equity deal activity down c.50-80% y/y. In this context, the headline Q1 miss was mostly driven by cyclical factors of lower transaction fees, performance fees and offsets. Guidance for full year 2023 FRE and fundraising was reiterated. Fundraising resilient in the quarter and FPAUM will step up when funds activate Fundraising was resilient in the quarter with c.$6bn of fee-eligible AuM raised and importantly, guidance for c.$20-25bn of fundraising was reiterated for 2023 as PHP highlighted a further $7bn closed after quarter-end from 2 partner-firms. FPAuM of $195bn (+6% y/y) did miss expectations as some delay in deployment is pushing back the timing of fund activations. PHP now have c.$21bn of AuM which should become fee-paying over 2023 including c.$17bn from Francisco Partners. Changes to estimates: lower 2023e -6-8% but estimates broadly unchanged thereafter We lower our 2023 FRE/DE by -6-8% but this mainly reflects the miss in the quarter, timing of fund activations and as we lower our performance fees to slightly below the target range (18.5% of revenue vs. 20-30% guidance). We leave our 2024-25 estimates broadly unchanged (-1%). Investment case: ''deep value'' can prevail with shares trading at c.60% discount to NAV Yes, earnings momentum is weak amid a more challenging market backdrop but ultimately, we think deep value can prevail. PHP now trades at c.7.5x 2023e P/E on our organic estimates (or c.6.0x 2024e P/E). On a balance sheet basis, PHP now trades at a c.60% discount to last reported NAV per share. From a yield perspective, PHP now offers a...