Although it was an outstanding festival, I would like to point out some problems that happened there.

outstanding 是由动词 outstand（突出、显著）加后缀 -ing 构成的形容词。out- 表示"超出"，stand 表示"站立"，合起来字面意思是"站得比别人高"，引申为"杰出的、突出的、显著的"。在这里形容节日非常出色、引人注目。