Top Performer for Tue: Perfect World (PWRD)

Perfect World Co. Ltd. (PWRD - Snapshot Report) is the latest in a long line of Chinese companies that have been featured as a Zacks #1 Rank Top Performer. Video game companies, like PWRD, have been especially highlighted on the list.

Today, a gain of more than 5% was enough to make the company a top performer. Meanwhile, volume is at 1.475 million, and, therefore, approaching the daily average of more than 1.6 million.

Yesterday, PWRD announced second-quarter results, including EPS that surpassed the Zacks Consensus Estimate and revenue that surged year over year. The company attributed much of the quarter's success to a strong performance from 'Battle of the Immortals', it's new 2.5D MMORPG. (MMORPG stands for 'massively multiplayer online role playing game'.)

PWRD is part of the Internet Content industry, of which there are 4 other companies on today's Zacks #1 Rank List. Those other companies are CDC Corporation (CHINA - Snapshot Report), InfoSpace, Inc. (INSP - Snapshot Report), Move, Inc. (MOVE - Snapshot Report) and NetEase.com, Inc. (NTES - Analyst Report). (CHINA and NTES are also Chinese companies.)

Second Quarter Report

PWRD earned 78 cents per ADS in its second quarter, which topped the consensus by nearly 28%. The result continued a solid streak of better-than-expected quarterly earnings, which has amassed an average surprise of more than 31% over the past 4 quarters.

Total revenues rose 56% from last year to $76.3 million. Online game operation revenues were up 26% to $69.6 million. In addition to the strong response for 'Battle of the Immortals', PWRD also enjoyed "increasingly optimistic" results from many of its existing games.

"We believe our fine-tuned strategy of allocating more resources to longer-term projects and larger expansion packs has really begun to show positive results," said Chairman/CEO Mr. Michael Chi.

Earnings Estimates

Yesterday's quarterly report hasn't had an impact on earnings estimates yet, but it likely will once the 12 covering analysts digest the info.

Overall, though, profit expectations have been moving in the right direction for the company. The Zacks Consensus Estimate for this year is at $2.49 per share, or approximately 10% better than the target from 2 months ago of $2.26.

Earnings estimates for next year have also gained about 10% in the past 60 days, moving the Zacks Consensus Estimate to $2.87 from $2.60. The current expectation suggests year-over-year profit improvement of more than 15%.