Image source: Tuesday Morning.

What: Shares of closeout retailer Tuesday Morning (NASDAQ:TUES) lost 22% in May, according to data from S&P Global Market Intelligence, as investors reacted to a third-quarter loss.

So what: The retailer's earnings report actually came out on the last day of trading in April, but the stock fell for the first five days of trading in May, shedding 16% over that period. For the third quarter, Tuesday Morning reported a loss of $0.12 per share, in line with estimates and down from a $0.06 loss a year ago, though it was a strong report by other conventional metrics. Comparable sales jumped 13.4%, driving a similar increase in overall revenue; however, gross margin fell 150 basis points to 36.7%. Selling, general, and administrative (SG&A) expenses also increased 12%, primarily due to higher rent as the company relocates stores to better locations and improves its real estate.

CEO Steve Becker said he was "very pleased" with third-quarter results, and said the company made progress on core initiatives including the development of its new Phoenix distribution center.

Now what: Tuesday Morning has been a volatile stock in recent years; shares have lost about 70% in the last year and a half as the company has missed analyst estimates and results have been erratic. The surprise resignation of its former CEO last year also sent the stock tumbling. Still, a double-digit jump in comparable sales is encouraging, and evidence that Tuesday Morning's real estate strategy is taking hold. If management can continue controlling costs and delivering that kind of growth, the stock should bounce back.

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