Internet stocks with strong earnings continue to do well in comparison with other sectors. The fact that they are unaffected by the overall impact of lower oil prices is a major reason for this.

The sector as a whole is relatively strong, but this article will look specifically at Internet Software. The industry is ranked 32 out of 265 (Top12%) of the Zacks Industry Rank.

Below I review four companies with strong growth and a recent beat of EPS. These companies have both a Zacks Rank of #1 (Strong Buy) or #2 (Buy) and have recently beat on EPS.

Channeladvisor (ECOM - Snapshot Report) is Zacks Rank #1(Strong Buy) that provides cloud-based e-commerce software solutions and publishes widely followed e-commerce sales data. It solutions include marketplaces, comparison shopping, paid search, social campaigns, flex feeds, web stores and rich media. The company serves traditional retailers, online retailers, brand manufacturers and advertising agencies.

Channeladvisor has a market cap of $300 Million. The company has EPS growth of 104% and 23.5% sales growth year over year. The stock sports a Zacks Style Score of “A in Growth.

Early in February, the company reported Q4 earnings of $0.11, an 18 cent beat.The stock reacted very well, moving from $9 a share to $14 in under a week, a 55% move. Since then the stock pulled back to the $11-$12 range.

CEO David Spitz went into detail on the quarter: 

“We had a very strong finish to the year, as our fourth quarter revenue and adjusted EBITDA were above the high end of our guidance ranges... Improvements in pricing, our focus on attracting and retaining larger retailers and branded manufacturers, and our emphasis on customer success helped produce a significant increase in gross merchandise value through our platform in the quarter, as well as continued growth in average revenue per customer. Revenue over performance came largely from a meaningful increase in variable subscription revenue and enabled us to exceed the $100 million mark in annual revenue for the first time in our company's history.”

Looking forward to fiscal year 2016, estimate revisions have been going higher. Over the last 60 days estimates have been raised 16% higher from -$0.99 to -$0.84. The EPS surprises and revisions shouldn’t be a surprise as this is the sixth straight EPS beat.

Ellie Mae (ELLI - Snapshot Report) is Zacks Rank #1(Strong Buy) that operates electronic mortgage origination networks and processes almost a quarter of all mortgage applications in the United States. The Company's network and technology-enabled solutions help streamline and automate the mortgage origination process.

Ellie Mae has a market cap of $2.5 billion with a Forward PE of 90. The stock sports a Zacks Style Score of “B” in Growth and has an expected EPS growth of 23%.

The company reported Q4 earnings early in February and the stock is up over 40% since. Q4 EPS came in at $0.44 versus the $0.21 expected with revenues coming in at $68.9 Million verse the $61.7 Million expected. While it might not be a good idea to chase the stock up here, any pullback would provide opportunity for a long-term investment.

Netease (NTES - Snapshot Report) is Zacks Rank #1(Strong Buy) that is an Internet technology company engaged in the development of applications, services and other technologies for the Internet in China.It provides online gaming services that include in-house developed massively multi-player online role-playing games and licensed titles. NetEase also provides online advertising, community services, entertainment content, free e-mail services and micro-blogging services.

Netease has a market cap of $19 Billion and a Froward PE of 16. The company also pays a dividend of 0.98%. The stock sports a Zacks Style Score of “A” in Momentum and “B” in Growth. Sales growth for the company is up 105.5% year over year.

Late last month, the company reported Q4 EPS of $2.74 verse the $1.56 last year and reported revenues of $1.22 Billion verse $593.7 Million last year. They also raised the dividend from $0.56 to $.064. The EPS beat is the company’s fourth straight surprise to the upside. However, the stock did not respond well as it sold off 15%. The sell off looks like it could be a long term opportunity for this volatile growth stock.

Globant (GLOB - Snapshot Report) is Zacks Rank #2 (Buy) that is a technology service provider that provides engineering, design, and innovation services for clients.

The company has a market cap of $1 Billion and a Forward PE of 26.The stock sports a Zacks Style Score of “B” and is seeing 30% revenue growth year over year. Globants expected EPS growth is at 17.50%.

Three weeks ago the company reported Q4 earnings with a 2 cent beat and a slight beat on revenue. The stock reacted well and is up over 10% since the report.Like ELLI, investors shouldn’t chase this one, but rather be patient in waiting for pullbacks.

Looking to fiscal year 2016 we see a slight revision of estimates upward. However, for fiscal year 2017, we have seen revisions aggressively raised over the last 90 days. Estimates during this period have gone from $1.27 to $1.41, a jump of over 11%.

In Summary

Sticking with strong internet names with solid growth continues to work. Investors should shy away from anything oil related as oil companies sort out their issues. Chasing stocks going higher will be dangerous in a market poised to pullback, so be patient upon entry.