Pier 1 Imports saw shares climb more than 8% in midmorning trading after the company reported 13.7% same-store sales growth for the third quarter. Total sales were $327 million, compared to $301 million in the third quarter last year.

Traffic, average tickets and merchandise margins all improved in the third quarter, said CEO Alex Smith in a statement. He added that the company had a very strong Thanksgiving weekend. The company will report third-quarter earnings on Dec. 17.

Comparisons were a bit easier this quarter, so it shouldn t be too surprising that same-store sales improved, says Stacey Widlitz, an analyst with Pali Research. Pier 1 has introduced more lower-priced gift items in an effort to attract consumers on a budget, and the strategy seems to be paying off, Widlitz says. Pier 1 s comparisons are moving in the right direction, but the company is still likely to report a loss for the quarter, she says.

Pier 1 had been running at pretty lean staffing levels, so third-quarter earnings could reflect increased costs from bringing in more labor to cope with more shoppers, says Brian Nagel, an analyst with Oppenheimer & Co.

Bottom line: The picture is improving for Pier 1, but losses for the quarter and the year are still likely.

Toll Brothers Down

Shares of luxury home builder Toll Brothers fell more than 6% in midmorning trading after the company announced a wider-than-expected loss for the fiscal fourth quarter.

The company reported a net loss of $111.4 million for the quarter, or 68 cents per diluted share, greater than the net loss for the same quarter last year of $78.8 million, or 49 cents per diluted share. Analysts had expected a loss of 46 cents per share.

CEO Robert Toll said in a statement that the company anticipates the housing recovery will be gradual, but that consolidation in the industry will allow Toll Brothers the opportunity to gain market share, as smaller, private builders focused on the luxury market are facing serious capital constraints.

The market may be disappointed by the fact that the company s gross margins are still trending down especially as home builders focused on the lower end of the market are starting to see margins improve, says Merrill Ross, an analyst with BGB Securities. The luxury market will take more time to turn around than the lower end, but public home builders began to gain market share at the end of the recession in 1991, and the pattern could be even more dramatic in this recovery, as capital is even more constrained, Ross says.

Bottom line: It s just not quite time yet to recommend the high-end part of the market, Ross says.