Image source: Conn's. What happened Shares of Conn's Inc. (NASDAQ: CONN) were moving higher today after the rent-to-own retailer delivered a better than expected third-quarter earnings report. The stock closed up 8.9% on the news. So what Conn's posted an adjusted loss of $0.08 per share in the period, but that was better than expectations of a $0.12 loss. Due to recent underwriting refinements, same-store sales fell 10.1%, leading to a 5% drop in revenue to $376.8 million, worse than the consensus $392.8 million. However, adjusting for the new refinements, same-store sales were down just 0.1%, meaning revenue would have been closer to the analyst estimate. Though the new credit requirements cut into the company's retail sales, they are having the desired effect on loans, as CEO Norm Miller said: "Initial indications are encouraging as Conn's experienced meaningful reductions in early stage delinquency and first pay defaults during the fiscal 2017 third quarter." Retail gross margin also improved 40 basis points sequentially, a sign that store operations are improving in spite of slower sales. Now what Conn's stock crashed in 2014 as a number of its loans went bad, so enhancing its credit standards to lower delinquencies seems like a smart move. Separately, the company also implemented its Texas direct-loan program, which increased the annual percentage rate on loans in Texas, where half of its stores are, by more than 500 basis points to 27%. Management expects companywide yield to improve by 600 to 900 basis points next year thanks to such changes. Looking ahead to the fourth quarter, management expects similar results to the third quarter: a 10% decline in same-store sales, and gross margin of 37% to 37.5%. While this year is shaping up to be a forgettable one, the retailer looks like it's on track to return to profits in 2017. 10 stocks we like better than Conn's When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now... and Conn's wasn't one of them! That's right -- they think these 10 stocks are even better buys. Click here to learn about these picks! *Stock Advisor returns as of Nov. 7, 2016 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.