The ratings on Canadian Tire Corp. Ltd. reflect the Toronto, Ont.-based company's leading position as Canada's largest hardware-goods retailer. Further supporting the ratings are the company's resilient earnings in the past several years, despite numerous competitive threats and unforeseen events, and a credit card operation that contributes significantly to operating income and is likely to further benefit from Canadian Tire Bank--the company's new banking arm, with a healthy liquidity position. These factors are offset by profitability measures that are average for the ratings category; operating margins that have not grown materially in the past few years, despite consistent revenue growth; and volatility related to Canadian Tire Petroleum earnings. Canadian Tire is one of the largest retailers in Canada, operating nearly
