For a while, Canadian retailer Canadian Tire (TSE:CTC) was considering dropping its financial services arm, Canadian Tire Financial Services (CTFS). Thus, it staged a review of said operations and, ultimately, decided that it would keep the operation in play after all. Investors did not take this news well and sent shares down over 2% in Monday morning’s trading.
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Basically, Canadian Tire decided that it would keep its operation in place and use it as part of a larger overall plan to improve its Triangle Rewards loyalty program. The review process found that Canadian Tire itself was in the best position to get the most value out of CTFS, mostly because CTFS manages the Canadian Tire credit card operations for over 2.3 million cardholders. These also represent, a report from The Market Online noted, many of Canadian Tire’s most loyal customers.
It certainly does not hurt matters that CTFS is a big part of Canadian Tire’s operations. Over the last 10 years, CTFS has seen credit card receivables come in at $7.3 billion. That was enough to make Canadian Tire the seventh-largest credit card issuer in Canada and brought in $385 million in revenue just in 2023 before taxes kicked in.
Improving the Shopping Experience
Meanwhile, Canadian Tire also realized that it was not enough to offer an easy way to make purchases. It had to help get customers to the point where they would purchase something, and not long ago, it came out with a way to help do just that. Specifically, an AI–driven shopping assistant that is specifically geared toward making tire purchases.
The system is known as CeeTee—like CT—and appears in the form of a smiling red triangle that asks customers questions and, from there, pins down their best purchases accordingly. Not only can CeeTee help customers compare different kinds of tires, but the system can access inventory records to make sure a tire is in stock or check for any available sales.
Is Canadian Tire a Good Company to Invest In?
Turning to Wall Street, no analysts currently have positions on CTC stock, so instead, we turn to the last month of trading. Overall, CTC stock is down 5.62%. It staged four rallies of varying sizes throughout the month but lost that momentum not long after in each case. Then, another substantial decline followed to round out the month.
