What happened

Shares of Conn's (CONN -3.02%) are 19% higher in morning trading Thursday after the rent-to-own furniture retailer blew past Wall Street's first-quarter earnings expectations.

So what

Conn's posted net income of $45.4 million, or $1.55 per share on an adjusted basis, compared to losses of $54.6 million, or $1.89 per share, a year ago. Revenue was $363.7 million, up from $317.2 million, almost 15% higher year over year.

Analysts had forecast Conn's would post earnings of just $0.30 per share on $327 million in sales. Consensus estimates typically exclude one-time items that companies adjust for.

Woman looking at home furnishings

Image source: Getty Images.

Comparable sales also rocketed 19.4% higher in the quarter, and were up just under 2% on a two-year stack, to eliminate the impact of last year's pandemic which forced most stores to close for weeks or months at a time.

Now what

While the record profit for Conn's is welcome, investors need to understand the furniture retailer and other retailers also reporting blowout earnings are benefiting from a unique scenario not likely to be repeated.

Beyond going up against much easier comparables, retail stocks are realizing a windfall because of a third stimulus package that put more money into consumers' hands. That will likely result in a hangover in quarters to come, especially next year when Conn's and others have to go up against these excellent numbers.