NEW YORK (AP) -- Shares of Overstock.com Inc. soared Friday after the online discount retailer reported its first-quarter loss narrowed dramatically and sales rose 27 percent, beating analysts' expectations.

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Overstock shares rose $3.49, or 25 percent, to $17.49. In the past year, the stock has traded between $8.61 and $39.39.

Earlier, Overstock said its loss narrowed to 17 cents per share, compared with a loss of 91 cents per share in the year-ago quarter. The company's revenue rose 27 percent to $200.7 million.

Analysts polled by Thomson Financial had expected a loss of 32 cents per share and sales of $168.8 million.

In a phone interview, Canaccord Adams analyst Domenic LaCava attributed the stock's climb to Overstock beating consensus expectations, and said there was probably a bit of a "short squeeze" going on as well, with investors buying shares to cover their short positions on the stock.

A short position involves an investor betting a stock's price will fall. When the shares rise, short-sellers must cover their positions by buying stock, which sometimes pushes up the price.

Asked if he was surprised by Overstock's results, LaCava said, "I think coupled with the fact that they had negative sales growth last year, plus no guidance, it's difficult to take that and forecast 27 percent growth."

He also noted that since Overstock does not issue guidance, it is hard to say if its first-quarter growth is sustainable.

Still, "They're good results. There's no getting around it," he said.

LaCava rates the stock "Sell" and his last published price target for the stock was $9.50. The analyst said his rating and estimates are under review, pending Overstock's first-quarter conference call on Tuesday.