Welcome to Week 3 of the Big Idea Portfolio. For the second consecutive week, Riverbed Technology and salesforce.com (NYSE: CRM) led the way for me. Investors seem convinced these stocks will outperform as much as Google (Nasdaq: GOOG) underperformed in reporting earnings on Thursday night. Details below, but first let's dig into the numbers.


Starting Price*

Recent Price

Total Return

Apple $422.46 $427.75 1.3%
Google $650.09 $639.57 (1.6%)
Rackspace Hosting $41.65 $43.56 4.6%
Riverbed Technology $25.95 $29.41 13.3%
Salesforce.com $100.93 $114.51 13.5%
AVERAGE RETURN -- -- 6.22%
S&P 500 SPDR $127.71 $131.46 2.94%
DIFFERENCE -- -- 3.28

Source: Yahoo! Finance.
*Tracking began at market close on Jan. 6, 2012.
**Adjusted for dividends and other returns of capital.

If this week's results look misleading, it's because deadlines forced me to use Thursday's market close as the benchmark. Had I included the great-than-8% sell-off in Google shares in these results, I'd either be losing slightly or about even with the market. I'd be a very small-f fool indeed to claim an edge at this point.

Google's numbers hurt me most. Analysts looking for $10.51 of non-GAAP earnings were instead treated to $9.50 a share of profit. An 8% decline in the cost per click for Google ads led margins lower, resulting in the shortfall. Yet CEO Larry Page doesn't necessarily see that as a long-term problem. Instead, he's aiming for better aggregate results for advertisers.

"There are lots of product changes that we can make that can increase CPCs or decrease CPCs and kind of have ... an inverse effect on the number of clicks and sort of not change the actual dollars spent, for example," Page said during a conference call with analysts.

Neither Riverbed nor salesforce.com had much in the way of hard news to report over the past week, though salesforce.com ranked 27th on Fortune magazine's annual list of the 100 best companies to work for, up 25 spots from last year. Google ranked first, while Rackspace Hosting ranked 74th.

The week that was
Despite a strong week in the S&P 500, trading volume remains muted as investors ponder the consequences on ongoing talks about restructuring Greek debt. Default remains a looming threat, even if it hasn't done much to halt a banking recovery here in the United States.

Shares of Bank of America (NYSE: BAC) rose 5% in early trading on Wednesday, after the financier reported positive fourth-quarter and full-year results. B of A also reported an improving equity ratio and better credit quality. All signs point to recovery after a long period of malaise.

Although we can't know exactly what's to come in 2012, tech investors were treated to a smorgasbord of good earnings results. IBM grew sales 1.6% in the fourth quarter while adjusted profits expanded more than 11% and beat estimates by $0.09 a share. Big Blue also forecast 2012 earnings that exceeded Wall Street's forecasts.

Microsoft (Nasdaq: MSFT) and Intel (Nasdaq: INTC) also outperformed. Mr. Softy beat estimates by $0.03 despite a troubling 6% decline in revenue from the Windows division, while the other half of the "Wintel" duo gained on a 17% increase in revenue from its PC division. Tech looks to be on track for now, but we won't have a full picture until Apple reports next Tuesday.

There's your checkup. See you back here next weekend for more tech-stock talk. In the meantime, you can check out the Fool's latest special report -- "3 Stocks That Will Help You Retire Rich" -- and add the Big Idea portfolio stocks to your Foolish watchlist for ongoing, up-to-the-minute coverage. Both the report and the watchlist as 100% free to use: