Join our community of smart investors

This British fashion house is ready to take on Europe's elite

While a work in progress, the group remains a takeover target
April 5, 2023

There are few patterns more recognisable than the iconic Burberry (BRBY) check: a beige base overlaid with intersecting black, white and red stripes. The tartan first appeared as a lining on the inside of the brand’s signature trench coats a century ago. But in the modern era it didn’t become ubiquitous until the years around the millennium, when Burberry’s plaid baseball caps became inextricably linked with football hooligan culture.

Tip style
Value
Risk rating
Medium
Timescale
Long Term
Bull points
  • Return to growth in China
  • Focus on ultra-luxury consumer
  • Long-established brand
Bear points
  • Lower margins than rivals
  • Brand transformation incomplete
  • High management churn

The association between Burberry and antisocial behaviour eventually became so strong that by 2004 pubs had reportedly started barring plaid-clad punters from entry. This did nothing to boost the brand’s luxury standing, with one commentator deeming its trademark check the “ultimate symbol of nouveau riche naff”. Even now, some two decades on, the pattern has not been fully rehabilitated in the eyes of the fashion world.

This is subscriber only content
Start your trial to keep reading
PRINT AND DIGITAL trial

Get 12 weeks for £12
  • Essential access to the website and app
  • Magazine delivered every week
  • Investment ideas, tools and analysis
Have an account? Sign in