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 Overstock.com, (NASDAQ:OSTK) were dazzling the market today, climbing as much as 20% after the company delivered strong sales growth in its second-quarter earnings report.

So what: The online retailer saw revenue increase 13% in the quarter, to $332.5 million, beating estimates at $315.2 million as orders and average ticket both increased. Despite the better-than-expected sales growth, bottom-line results weakened as profits fell from $0.15 a share to $0.08, worse than the consensus at $0.10, as marketing expenses grew 23%. CEO Patrick Byrne noted that it was the company's 10th-straight-profitable quarter, and credited increased technology spending for the improved performance. 

Now what: While the revenue growth was promising, Overstock seems like it will never be much more than a bit player in online retail, as it competes directly with Amazon.com, and seems unable to meaningfully differentiate itself. Also, the recent revenue growth has come at a price, as Overstock has missed earnings estimates in its last four quarters. If the retailer can find a way to consistently deliver revenue and profit growth, I may become a believer; but to do that, the company needs a better way to stand out in a sea of online retailers.