WPP reported results ahead of expectations Q3 organic sales growth came at +15.7% versus consensus at c10%, implying a 6.9% growth rate on a 2-year stack. Although WPP Management highlighted the performance was broad-based, we note the performance was driven by GroupM (+29% organic, +15.5% on a 2y stack), Hogarth, VMLYandR (both double digit organic) and specialist agencies, while some agencies have not come back (yet) to 2019 levels (Wunderman Thompson almost there, AKQA and Ogilvy still lagging). We note the strong performance in Germany was driven by a COVID-19 related contract that added 100bps to the group organic growth for the quarter. The company also raised guidance On the back of the better-than-anticipated results, WPP raised FY21 guidance for organic net sales growth from 9%-10% to 11.5%-12% and headline operating margins slightly above 14%. Guidance elements on capex and working capital outflow remained unchanged. When asked on the supply chain disruption risks, Management explained they have not seen any impact (or marginal headwinds for automotive clients), which is reassuring. Forecast change Reflecting the Q3 beat and the guidance upgrade, we increase our FY21 group organic growth forecast from 9.5% to 11.5%, at the low end of the new guidance. We broadly kept unchanged our margin expectations. Bottom line, we increase our EPS by 5%/2% for FY21e/FY22e. We reiterate our Underperform rating despite encouraging performance We upgrade our TP by 5% to GBPp1000 (from GBp955), in line with our EPS revisions for FY21. While we recognize the company has made sizeable efforts in recent quarters to simplify its structure and better position its digital assets, we remain sceptical on WPP prospects on the back of: 1) a less appealing asset mix versus PUB; 2) weaker new business versus prior year and versus peers; and 3) structural challenges not going away. We remain Underperform.