Canadian Tire Corporation Limited (TSX:CTC.A) is one of Canada’s largest retailers of general merchandise, automotive products, sporting goods, and apparel, and it is the company behind Canadian Tire Financial Services and CT Real Estate Investment Trust.

It announced its fourth-quarter earnings results before the market opened this morning, and its stock has responded by rising over 5%. Let’s take a closer look at the quarterly report and the fundamentals of its stock to determine if we should consider buying in to this rally or if we should wait for it to subside.

The results that ignited the rally

Here’s a summary of Canadian Tire’s fourth-quarter earnings results compared with what analysts had projected and its results in the same period a year ago.

Metric Q4 2015 Actual Q4 2015 Expected Q4 2014 Actual
Adjusted Earnings Per Share $3.01 $2.55 $2.65
Revenue $3.38 billion $3.39 billion $3.65 billion

Source: Financial Times

Canadian Tire’s adjusted earnings per share increased 13.6% and its revenue decreased 7.5% compared with the fourth quarter of fiscal 2014.

Its double-digit percentage earnings-per-share growth can be attributed to its adjusted net income increasing 8.1% to $225.2 million and its weighted-average number of diluted common and Class A non-voting shares outstanding decreasing 4.5% to 74.94 million.

The company noted that its weak revenue performance was due to lower shipments in its Canadian Tire Retail segment, decreased sales at FGL Sports and Mark’s, and the negative impact of lower fuel prices in its petroleum segment.

Here’s a quick breakdown of six other notable statistics from the report compared with the year-ago period:

  1. Same-store sales increased 2% at Canadian Tire and 1.6% at Sport Chek and decreased 0.4% at FGL Sports and 5.2% at Mark’s
  2. Gross profit decreased 2.9% to $1.18 billion
  3. Gross margin improved 160 basis points to 34.8%
  4. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased 8.4% to $474 million
  5. Adjusted EBITDA margin improved 200 basis points to 14%
  6. Cash generated from operating activities before specific items increased 14.4% to $790.4 million

Canadian Tire also announced that it will be maintaining its quarterly dividend of $0.575 per share, and the next payment will come on June 1 to shareholders of record at the close of business on April 30.

What should you do with Canadian Tire’s stock today?

It was a great quarter overall for Canadian Tire given the many headwinds it faced, including lower fuel prices, unusually warm weather, and the weak economic environment, so I think its stock has responded correctly by rallying. With this being said, I think the stock could continue higher from here and that it represents an attractive long-term investment opportunity for three primary reasons.

First, Canadian Tire’s stock trades at just 14.3 times fiscal 2015’s adjusted earnings per share of $8.61, which is very inexpensive given the strength and stability of its business model, its estimated 7% long-term earnings growth rate, and the industry average multiple of 24.2.

Second, Canadian Tire pays an annual dividend of $2.30 per share, which gives its stock a moderate and very safe 1.9% yield. Investors must also note that the company has raised its annual dividend payment for five consecutive years, and its 9.5% increase in November 2015 has it on pace for 2016 to mark the sixth consecutive year with an increase.

Third, Canadian Tire has been actively repurchasing its shares, including 2.6 million shares for a total cost of $290.6 million in fiscal 2014 and 3.45 million shares for a total cost of $434.6 million in fiscal 2015. It also has a program in place to repurchase $550 million worth of its common shares by the end of 2016, and as of the end of the fourth quarter, $440 million remains for repurchase under that plan. These repurchases will boost the company’s earnings-per-share growth potential going forward and shows that it is fully dedicated to maximizing shareholder value.

With all of the information provided above in mind, I think Canadian Tire represents one of the best and safest long-term investment options in the retail industry today, so take a closer look and consider beginning to scale in to positions over the next couple of weeks.

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Fool contributor Joseph Solitro has no position in any stocks mentioned.