Limited underperformance vs sector in 1Q ending June 2023 Burberry posting 18% Retail comps in 1Q ending June 2023 was fully in line with both consensus and BNPPE. The company does not disclose Wholesale (c20% of sales) by quarter but taking the 1H guidance (low DD decline) as a proxy for 1Q trends, we estimate Burberry''s overall growth at constant FX rate at around 12%. Only Kering brands, Ferragamo and WOS grew by less (Ferragamo by far less, WOS expected negative for technical reasons), but taking into consideration that Burberry is still fully in a transition phase - new Artistic Director Daniel Lee did not impact the quarter - we rate this c12% as an ''OK'' number. Like for many luxury stocks, consensus looks a bit high for calendar 3Q (BRBY''s 2Q) In our 31 July sector flashnote, we outlined 3Q consensus was likely too high for many luxury stocks as we believe some analysts may be underestimating the tougher basis of comparison in China and the normalisation in demand elsewhere. This is also true for Burberry, for which VA consensus for Retail comps is 8% whilst we have 6%, not a huge gap though. On 14 July, Burberry updated its FY Mar 24 FX EBIT headwind guidance to GBP70m, this has not really moved since then and is now adequately reflected in consensus (unlike for most luxury companies reporting in EUR and CHF). Awaiting consumers'' reaction to Daniel Lee''s products as from September When Daniel Lee presented his first (small) collection as well as a new communication campaign in February 2023, the media''s feedback on the whole was positive. Since then, management has repeatedly made positive qualitative comments about key Wholesale accounts'' feedback and is guiding to a rebound in 2H significant enough for the low DD decline in 1H to be fully recouped. However, this is not enough for us to draw conclusions about the end consumer reaction. In 3Q ending Dec, Daniel Lee should have designed 30% of the newness in Oct-Nov (half of the...