Ross Stores’ stock price soared today as the off-price retailer raised its full-year profit forecast and reported third quarter results that topped expectations.

CEO Barbara Rentler said on the company’s earnings call on Thursday that she expects to see a “very promotional holiday selling season” as inflation continues to pressure its low-to-moderate income customers.

“With consumers’ heightened focus on value and convenience, this bodes well for our ability to expand our market share and profitability in the future,” Rentler told investors. “We really have an improved holiday assortment this year of both branded bargains, based off of availability in the marketplace, and also our gift giving because of the imbalances we had from the supply chain congestion last year.”

In the third quarter of 2022, the Dublin, Calif.-based retailer reported net sales of $4.565 billion, down slightly from $4.574 billion the same time last year. Net earnings were $342 million in the quarter, down from $385 million in Q3 2021.

At the time of press, Ross Stores shares were up 10.71% on Friday to $108.42.

According to Rentler, shoes were the biggest category in the quarter, which was fueled by strong value on branded products and availability in the market, while Florida and Texas were the top-performing regions, which were bolstered by the outperformance of border and tourist locations.

Turning to inventory, Rentler said that Ross ended the quarter up 12%, which, she said, is a “big improvement” from the second quarter when the company was up 55% in inventory. “The increase over the last year is really attributable to packaway inventory,” the CEO said. “And last year was relatively low versus our historical levels because we used a substantial amount of our packaway to chase sales that were well above our plan.”

Looking ahead, Ross Stores is raising its guidance given its third quarter sales momentum and improved holiday assortments. “We now expect fourth quarter same store sales to be flat to down 2% on top of a 9% gain in the prior year, with earnings per share forecasted to be in the range of $1.13 to $1.26,” Rentler said. “Based on our year-to-date results and our fourth quarter forecast, earnings per share for fiscal 2022 are now projected to be in the range of $4.21 to $4.34 versus $4.87 last year.”

“There remains a high level of uncertainty in today’s macroeconomic and geopolitical environment that continues to negatively impact consumer sentiment and demand,” Rentler added. “However, we remain confident in the off-price business model, which offers both value and convenience.”