Out in front: another beat Despite ongoing supply chain challenges Puma delivered a record absolute quarterly profit in Q3 and a consensus beat driven by sales. The results leave us more confident about Q4 profits, China, the supply outlook for Q1, and margins for 2022. The risks haven''t gone away, but the company has navigated through them well so far, and we still see Puma as an outperformer. Q3 sets up a full year personal best Q3 EBIT of EUR c.229m was 13% ahead of consensus, driven by a 5% sales beat and good operating leverage. This was despite more than EUR 200m of sales lost to supply constraints and higher sourcing costs. The exit rate from the quarter, on a two-year stacked sales growth rate, was the strongest of the year (see Figure 1) despite continued pressure in China caused by the cotton controversy and boycott of Western brands. The cat''s out of the bag: Q4 guidance is conservative Management raised its guidance for FY EBIT to EUR 450-500m, which would represent record profits. Even the top end implies Q4 profits fall heavily from EUR 63m last year (to EUR 8m this year), which we think is unlikely. We factor in EUR 200m lost sales from supply constraints but land above guidance, on full year EBIT of EUR 518m. Valuation: still an undervalued player We bank the Q3 beat, leaving Q4 unchanged, and our target price rises by 2%. We continue to see attractive sales and margin potential. Puma trades on optically high near-term margins but we think Puma remains attractively valued. This is supported by our DCF valuation which assumes long term margins of 14%, just 200bps higher than Puma achieved this quarter. Inside we set out 15 questions for management and key highlights from the Q3 conference call.