When you're priced for perfection, simply beating Wall Street's targets may not be enough. Baidu.com (NASDAQ:BIDU) is finding out the hard way with its shares taking a 14% hit in after-hours trading on the heels of what appears to be another healthy report out of China's leading search engine.

Earnings more than quadrupled to $0.21 a share, or $0.25 a share before stock-based compensation expenses. Analysts were willing to publicly settle for just an $0.18 per-share showing. Revenue soared 175% higher to hit $24 million, also better than the $23.3 million Wall Street was holding out for.

So far, so good. The company's outlook must have been horrendous, then, right? No, not really. The company's only guidance was for the current quarter to generate revenue between $30 million and $31 million. Analysts were perched on the $28.9 million mark. It didn't provide a bottom-line target, but that's all right, because it's exactly what it did after the March quarter, and things turned out just fine.

Deteriorating fundamentals, then? Nope. The company closed out the period with 90,000 advertisers, 22% more than it had at the end of March. That figure is even more impressive when coupled with the 41% top-line spike sequentially. In other words, the average online advertiser is spending more money through Baidu.

Headlines like "Slowdown Slams Baidu" were filed last night, but the truth of the matter is that analysts were already expecting that. The problem is that Baidu's shares had appreciated to the point where anything short of a blowout would be a failure.

With Google (NASDAQ:GOOG) and a more distant Yahoo! (NASDAQ:YHOO) nipping at its heels, Baidu doesn't appear to be a screaming bargain on the surface. Based on last night's close, Baidu is fetching 67 times next year's bottom-line target. Google and Yahoo! aren't dirt cheap by that metric, but they still trade at a more reasonable 30 and 40 times 2007's profits, respectively.

No, Baidu isn't cheap, but it's important to scratch beneath the surface. Baidu is a pure play in the red-hot Chinese economy. It's not just the smoking GDP but the inevitable online migration that comes with a developing economy, as just a tenth of the country's citizens have Internet connectivity in their homes.

Earlier this month, I sold my stake in Baidu. No, I didn't see this morning's sell-off coming. It wasn't even a lack of confidence in Baidu. In sizing up the investing opportunities available, I was finding some compelling bargains in some beaten-down stateside stocks and figured that my investing dollar should be deployed elsewhere. It's the perpetual weighing process that we, as investors, go through. If I see Baidu shares settle lower, I may very well buy back in later this year.

Baidu is doing just fine. It hit itself a homer. Unfortunately, the ball didn't carry out of the park where antsy analysts were waiting in the parking lot with baseball gloves to take home a souvenir that never came.

Longtime Fool contributor Rick Munarriz speaks two languages fluently. Neither is Chinese. He does not own shares in any of the companies mentioned in this story. The Fool has a disclosure policy. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.