Why Tilly's Inc.'s Shares Popped 25% Today

By Travis HoiumMarketsFool.com

What happened

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Shares ofTilly's Inc. (NYSE: TLYS) jumped as much as 25.3% in early trading Wednesday after the clothing company reporteda first-quarter loss. At 12:20 p.m. EDT, the stock had fallen slightly but were still trading 16.9% higher for the day.

So what

Total sales climbed 0.6% to $120.9 million and comparable-store sales went from a 4.1% decline a year ago to a 0.6% increase this year. However, net loss was still $0.2 million, or $0.01 per share, an improvement from a $0.10 loss a year ago.

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The reason shares bounced today is that analysts were expecting a $0.10-per-share loss on just $114.4 million in sales. So, results weren't great on their own, but often beating expectations is enough to push a stock higher.

Now what

If Tilly's can start to grow same-store sales at a faster rate, the stock definitely has a lot of upside given the operational leverage brands have. Also, considering the large earnings beat in a traditionally weak quarter, there could be good news ahead. I would be cautiously optimistic on Tilly's shares given the momentum and watch for higher same-store sales as the factor that will really boost shares if it helps earnings in much harder comparisons later in the year.

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Travis Hoium has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.