It hasn’t been a good day for WestJet Airlines Ltd. (TSX:WJA) with shares trading down as much as 11% during early trading. They’ve since recovered slightly, but are still 9% lower as I type this.

The company released earnings on Tuesday morning that weren’t great. The big fear from investors has always been that Alberta’s decline would hit WestJet hard. Although the company has made efforts to move away from its western Canadian roots, the fact is the airline still has a big presence in places like Calgary and Edmonton, two cities which have been badly hurt by oil’s decline.

Net earnings for the quarter came in at $63.4 million, which works out to $0.51 per share. This was down sharply compared with the same quarter last year when profits were $90.7 million. Included in the most recent quarter’s results was a one-time loss from currency movements of $10.1 million.

Investors expected profits to be down, but revenue unexpectedly took a hit as well, falling by 3.6% to $958.7 million. In the same quarter last year revenue nearly hit $1 billion, coming in at $994.4 million.

WestJet also cut its 2016 guidance. It had previously told investors its system-wide capacity would grow between 8-11% in 2016. On Tuesday’s conference call, execs backed off on that call a bit, forecasting total capacity to increase 7-10%. Approximately 3-4% of that total growth would come from domestic routes as the company switches its focus away from western Canada towards the eastern part of the country.

Finally, margins also fell. In the fourth quarter last year, the company posted operating margins of 14%. In its most recent quarter, they declined to 11.8%, and that’s even after the price of fuel went lower. Because fuel is priced in U.S. dollars and most revenues come from local currency, WestJet’s fuel costs haven’t gone down as much as you’d assume.

The good news

All in all, it was a pretty crummy quarter for Canada’s second-largest airline. But there were a couple pieces of good news hidden among all the bad stuff.

The most exciting thing for long-term shareholders is the share-repurchase plan. It’s obvious WestJet’s management thinks shares are undervalued, since the company announced it would be increasing its share-buyback program from four million shares to six million. If WestJet fully utilizes its buyback program, it will have eliminated almost 5% of its shares.

And from a full-year perspective, the results don’t look so bad. Even after the disappointing fourth quarter, profit for 2015 was $367.5 million, good enough for $2.92 per share. That’s an increase of 33% compared with 2014.

It also puts shares at a very cheap valuation. At a current price of $17 per share, WestJet trades hands at just 5.8 times earnings. Yes, airline earnings are typically very volatile, but WestJet has been consistently profitable throughout the last decade. The latest was WestJet’s 43rd consecutive profitable quarter. And the company is stable enough that it can pay a 3.3% dividend, a rarity in its sector.

WestJet is a unique airline. Most are hurt by an increase in the price of oil. But with some 25% of its flights coming out of airports in a region that runs on oil, it actually benefits from crude increasing. Right now, with oil being weak, shares are struggling. But if there’s any airline with the strength to ride through this turbulence, it would be WestJet. Perhaps spurned investors should look at these lacklustre earnings as a buying opportunity.

Another great long-term stock. Don't miss out!

WestJet isn't the only good company that's temporarily beaten down. There's one company we like even more!

Exports of liquefied natural gas could be one of the best growth opportunities out there for long-term investors. And, we think we've identified the Canadian company to invest in. It's a global company with operations across nearly 20 countries and 70 locations. We like it so much, we've named it as 1 Top Stock for 2016 and Beyond. To find out why, click here now to learn how to access your FREE copy today!

NEW! This Stock Could Be Like Buying Amazon In 1997

For only the 5th time in over 14 years, Motley Fool co-founder David Gardner just issued a Buy Recommendation on this recent Canadian IPO.

Stock Advisor Canada’s Chief Investment Adviser, Iain Butler, also recommended this company back in March – and it’s already up a whopping 57%!

Enter your email address below to claim your copy of this brand new report, “Breakthrough IPO Receives Rare Endorsement.”

Fool contributor Nelson Smith has no position in any stocks mentioned.