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What: Shares of Tuesday Morning Corporation (NASDAQ:TUES) woke up on the right side of the bed today, gaining as much as 20%, and finishing up 16% after delivering a promising earnings report last night. 

So what: The closeout retailer seemed to make further progress in its turnaround strategy, as comparable sales jumped 6.4% in the quarter on an 8.4% increase in traffic. Tuesday Morning has been closing stores recently, so overall revenue only improved 2.6%, to $182.8 million, short of estimates at $184.9 million. The company also saw inventories decline by 13.1% as it looks to streamline its product selection and exit unprofitable categories. Those two drivers helped Tuesday Morning deliver an adjusted per-share loss of $0.13, beating expectations of a $0.15 loss.

Now what: CEO Michael Rouleau said the company's "hard work is beginning to produce results," as it began the final phase of its turnaround process. Tuesday Morning did not provide forward guidance, but the company seems to be headed for a full-year profit after a large loss last year, as the comparable-sales growth is a particularly positive sign. Shares have already doubled in the past year, however, so they may be pushing their limit for now, as high expectations seem to be baked into the share price.

Jeremy Bowman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.