Zillow (NASDAQ:ZG) did everything that you would want out of a growth stock in yesterday's quarterly report. 

  • Revenue rose 69%, surpassing analyst expectations.
  • Initial reports pointed to Zillow's loss of $0.30 a share, greater than the $0.11 a share deficit that Wall Street was expecting. However, on a rightfully adjusted basis, Zillow actually managed to squeeze out a small profit. 
  • Guidance for the current quarter is ahead of where the pros were perched. 

With this kind of performance, it's hard to fathom the stock opening 8% lower -- and staying there through most of the trading day -- on the robust report. 

What did Zillow do wrong? Well, it's really more a matter of what it did right in the days and weeks leading up to the report. 

The stock falling 8% to open at $83.85 is significant, but this is a stock that began the month in the mid-$70s. A month earlier it was in the mid-$50s. Even with today's sharp drop, the stock has risen 49% since the end of June. It still opened 13% higher than it was at the end of July -- and just so we're clear here: That was just a week ago!

Zillow has been moving higher with good reason. Rival Trulia (NYSE:TRLA) posted blowout quarterly results last week. 

Yes, Trulia's revenue did grow a heartier 77%, but Trulia is also a lot smaller. It attracted an average of 35 million unique monthly visitors during the quarter, compared to the 61 million monthly unique users that Zillow drew to its website and two dozen mobile apps. 

It's easy to eye today's stock chart and view Zillow's report as a failure, but it's not. Pull up a week's chart, a month's chart, or why don't we point out that the stock has more than tripled since the year began?

Skeptics will argue that it was still a mistake to hold on to Zillow heading into this report. The shares were priced for perfection. Greedy investors could have taken their profits yesterday, assuming that they could buy back in at a lower price after even strong financials and a upbeat prognosis validated the model. That may seem true in retrospect, but trying to nail tops and bottoms is a game that even the nimble get wrong more often than not.

Holding on to Zillow through today's drop still means that folks that bought in at the beginning of the year have still tripled their money. That's not too shabby. It's been a great year to own the leading real estate travel website operator. And even though it may be hard to see at the moment, it's also been a pretty good day to own Zillow.

Longtime Fool contributor Rick Munarriz has no position in any stocks mentioned. The Motley Fool recommends Zillow. The Motley Fool owns shares of Zillow. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.