Procter & Gamble (NYSE:) reported better-than-expected Q3 net sales, driving its shares up nearly 1% in premarket trading.

Q3 net sales by consumer goods companies topped consensus estimates at $18.73 trillion. The Q3 earnings per share were $1.33 which was $0.03 more than the analyst estimate (1.30).

The organic revenue increased 10% over the estimated 6.24% growth. According to consensus, the company experienced a price effect of 5%.

For fiscal 2022, P&G expects organic revenue growth in the range of 6% to 7%, beating the consensus estimates of 5.49%. P&G expects core EPS growth to be between 3%-6%. The core earnings range is $5.83- $6.00, which compares to analysts’ estimates of $5.86 per share.

P&G said it expects headwinds of $2.5 billion due to increased commodity costs. The company still expects FY 2022 to see 4-5% growth, a significant increase from the 3-4% previously forecasted.

Company projects FY 2022 GAAP Diluted Net EPS Growth in the Range of 6% to 9.9%

“We delivered another quarter with strong sales growth and made sequential earnings growth progress despite significant and increasing cost headwinds,” said Jon Moeller, President, and CEO of P&G.

P&G expects to distribute more than $8 billion in dividends and buy back roughly $10 billion of its shares in FY 2022.

Stifel analyst Mark S. Astrachan reflected positively on PG’s earnings report.

“We view the result as solid, reflecting ongoing share gains across most categories. We anticipate F2022 consensus is unlikely to move materially, with PG shares up modestly given the strong topline,” Astrachan said in a client note.

Jason English, Goldman Sachs analyst reiterated a Buy rating of PG stock and a target price for the next 12 months at $173

“All-in, weaker gross margins and an EPS outlook revision toward the low end of the range was widely expected by investors we speak with while the 10% organic sales growth outstripped the HSD% expectation we heard from most. As such, we believe results are strong enough to drive relative out performance for the stock today,” English wrote in a memo to clients.

By Senad Karaahmetovic