The market likes the way Men's Wearhouse ( MW) looks. The company nearly halved its first-quarter profit, but investors gave the company a pat on the back anyway for actually posting a profit.

Shares of the retailer soared 16% to $20.70 Tuesday afternoon, a day after the company said profit fell to $5.3 million or 10 cents a share, from $9.9 million, or 19 cents, last year. Analysts had forecast a loss of a penny.

But it was through cost-cutting initiatives, not sales, that the company was able to attain a profit.

Sales fell 6% to $464.1 million from $491.1 million a year ago. Clothing product sales slipped 7.6%, though tuxedo-rental sales increased 1.7%.

Total same-store sales decreased 5%.

Looking forward, the company predicts second-quarter earnings in the range of 56 cents to 60 cents a share. And despite its ongoing cost-cutting initiatives, Men's Wearhouse plans to open eight new stores this year.

On Monday, Men's Wearhouse affiliate K&G Acquisitions nabbed bankrupt Filene's Basement for $67 million. The move could result in 20 cents towards Men's Wearhouse earnings by 2010, Stifel Nicolaus analyst Richard Jaffe said in a note.

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