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Watching The TapeFintrust Investment Commentary Memorial Day is a day when Americans remember our fallen heroes. Memorial Day is also the unofficial beginning of summer, a time when the markets slow down, investors take vacations….and companies you’ve never heard of release their earnings. Or maybe you have heard of Splunk...or Safe Bulkers... or Golden Ocean. Not exactly Dow Jones Industrial stocks. Every week we list upcoming earnings reports in The Week Ahead (below). However after looking at next week’s list, our first thought was…let’s just skip it. A few big names report next week – Autozone, Abercrombie, Toll Brothers – but those reports rarely move markets. The rest of the earnings come from companies you may not know. Curiosity prevailed, and we delved deeper into a few of next week’s names. Many turned out to be interesting companies, and we found a couple of surprises. Disclaimer: We are not recommending purchase or sale of any of the stocks discussed below. All the information was derived from company websites. Brown Shoe Company (earnings to be released on Wednesday) – Wait a minute, could this actually be Buster Brown? The dorky shoes our Moms made us wear when we were kids? (Note: if you were born after 1966 you have no idea what we’re talking about.) Yes, this is Buster Brown, and a lot more, including Famous Footwear and online seller . Brown Shoe sales are expected to exceed $2.5 billion this year. “Tell mom you want your pair right away.”Perfect World (earnings to be released Monday) - If there is a perfect world for online gamers, this company wants to provide it. Perfect World is a Chinese online video gaming company known for creation of ARC video games such as “Forever Mars”, “Swordsman Online” and “Prime World”. Many of their games combine “fierce battles, castle development and clan wars” (just what you want in a perfect world, right?) Annual sales are around $600 million. Typical battle in a Perfect WorldTidewater – reporting Tuesday - is the world’s leading provider of service vessels to the offshore oil and gas drilling industry. Tidewater tows drilling rigs, anchors rigs, transports supplies and personnel out to the rigs, lays pipe and cable and provides pollution and fire control. Tidewater operates in more than 60 countries, with gross sales around $1.5 billion. EHI Car Services – This company wasn’t interesting at first glance, a leading Chinese car rental company, okay whatever. Then we realized EHI matches the acronym for Enterprise Holdings Inc, the parent company of Enterprise, Alamo and National car rental brands. Turns out EHI is China’s affiliate of Enterprise Holdings, and is traded on the NYSE. Sales are expected to exceed $300 million this year. EHI reports earnings on Tuesday. Aegean Marine – a “marine fuel logistics” company. Aegean ships are like floating gas stations. The company buys marine fuel wholesale, stores it in “bunkering vessels” then delivers the fuel to ships that need fuel at sea. Not an industry most of us think about, but somebody does: sales are approaching $6 billion. Aegean reports earnings on Wednesday.Fill ‘er upSafe Bulkers – Though it sounds like it could be a dietary fiber company, Safe Bulkers is actually a dry-goods shipping company operating a fleet of 33 ships that deliver coal, grain and iron ore around the world. Sales are expected to exceed $150 million this year. Earnings will be released Wednesday. Splunk – Splunk is a software company that generates “operational intelligence”. Splunk enables companies to better target customers and improve efficiency. From the Splunk website: Machine-generated data is one of the fastest growing and complex areas of big data. It's also one of the most valuable, containing a definitive record of all user transactions, customer behavior, machine behavior, security threats, fraudulent activity and more. Splunk turns machine data into valuable insights no matter what business you're in. It's what we call operational intelligence.Operational intelligence gives you a real-time understanding of what’s happening across your IT systems and technology infrastructure so you can make informed decisions. This year Splunk revenues may exceed $600 million. Earnings will be released on Thursday. (Note: we figure Splunk is reading these words in real time as we write them.) Other interesting names releasing earnings next week. Golden Ocean is another bulk shipping company. Seadrill does exactly what their name suggests. Several Chinese solar power and wind power companies release earnings. For now we’ll relax in the sunshine, enjoy Memorial Day, and slip on our Buster Brown sandals.The Week AheadEconomics – Kaitlin Matheson*On Thursday the Federal Reserve will release its balance sheet, a weekly report of the features supplying and using reserve funds in the banking system. Historically, most investors have not cared much about this report because the federal funds rate, the interest rate at which banks make overnight loans to each other from their funds at the Federal Reserve, was a better way of monitoring the Fed’s monetary policy. However, the Fed reduced the target federal funds rate to basically zero in 2008 when the banks were up a creek without a paddle… actually some banks situation more closely resembled a canoe atop Niagara Falls. The goal of reducing the target rate to zero is to promote banks to lend more and increase liquidity in the economy. Since 2008, the balance sheet has been one way to watch these effects. Investors watch the change in assets each week on the balance sheet, along with other factors, to determine the increase or decrease in liquidity the Fed is pumping into the financial system. The importance of the balance sheet is that it details the financial institutions dependence on the Fed, shown by the amount of reliance they have on Fed loans. Most investors are expecting the Fed to raise the target fed funds rate in the fall or winter, and it will be interesting to see if the balance sheet activities will remain significant. Other announcements next week include Durable Goods and New Home Sales on Tuesday, and the GDP (Gross Domestic Product) on Friday.*Kaitlin is a nationally recognized economics student at Clemson UniversityEarningsMonday: Perfect WorldTuesday: Autozone, Ehi Car Service, Taro Pharmaceuticals, Tidewater, TivoWednesday: Ahold, Aegean Marine, Brown Shoe, Michael Kors, China Ming Yang, Popeyes, Safe Bulkers, Tiffany & Co, Toll Brothers, ValsparThursday: Agilysys, Abercrombie, Boot Barn, Envivio, Flowers Foods, Freds, Stealthgas, Gamestop Omnivision, Pacific Sunwear, Sanderson Farms, Seadrill, Splunk, Veeva Systems, Better Online Solar, Golden Ocean Group, Hanwha Solarone, Jinkosolar, Mix Telematics, China Xiniya FS, Xcerra, ZumiezFriday: Big Lots, Destination XL, Genesco, Graham CorpWatching the Tape is compilation of news, observations and views written by Bill Kibler, Senior Vice President, FinTrust Investment Advisors. Bkibler@. Information is provided by sources believed to be reliable, but FinTrust is not responsible for accuracy. The information herein is not a recommendation to buy or sell any security. Past performance does not indicate future results. HYPERLINK "" \o "Join APViewpoint" \t "_blank" ................
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