Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What:  Shares of childhood education specialist LeapFrog (NYSE:LF.DL) were getting held back by investors today, falling as much as 12% despite a strong third-quarter earnings report.

So what: Leapfrog stock opened the day higher but quickly fell into negative territory. Sales for the quarter increased 28%, while EPS jumped 71% to $0.60. The maker of tablets and other electronic children's devices raised its full-year sales guidance to a range of $535 million to $550 million, an increase of about 20% from last year, and its EPS outlook to a range of $0.75 to $0.81 cents, up 150% from 2011. The company also announced that it will continue its partnership with Lions Gate Entertainment (NYSE:LGF-A) to distribute four animated films on DVD starting in 2014.

Now what: The market reaction is certainly puzzling here. Analysts were expecting a profit of just $0.42 per share in the all-important back-to-school quarter but may have been disappointed that the company didn't raise its guidance higher, considering the earnings beat. Wall Street is projecting a $0.51 EPS in the fourth quarter, which would equal an $0.85-per-share profit for the year. Management could be giving a lowball estimate here, though, as it's increasing advertising expenditures 20% to 25% for the holiday shopping season in an effort to ramp up sales, explaining, "Our results for the year will ultimately depend on holiday sell-through of our products." At a P/E of just 12 after today's sell-off, shares look mighty cheap, and a blowout holiday quarter could be in store. This could be a great time to get in.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.