Chapter 1: What are the latest trends in retail sales and the K-shaped economy?
Welcome to Seeking Alpha's Wall Street Lunch, our afternoon update on today's market action, news, and analysis. Good afternoon. Today is Tuesday, February 10th, and I'm your host, Kim Kahn. Our top story so far. Retail sales were flat in December, missing expectations for a 0.4% increase and slowing from 0.6% growth in November. Sales were up 2.4% from a year ago.
Core retail sales, excluding motor vehicles and parts, were also flat versus forecasts for a 0.4% gain. Heather Long, chief economist at Navy Federal Credit Union, said...
Chapter 2: How did Datadog perform in its latest earnings report?
This is a K-shaped economy, with strong spending from the top and much more cautious spending from the middle and lower income consumers. She added the holiday season was solid but not spectacular, with shoppers hunting for bargains and buying early to grab discounts. Overall, the consumer is still spending, Long said, but this is the Costco economy for the middle class.
Among weak categories, furniture and home furnishings down 5.6% from a year ago.
Chapter 3: What does Paramount's revised bid for Warner Bros Discovery entail?
Department stores were down 0.3% year over year. Not great news for Macy's, Kohl's, and Dillard's. and non-store retailers rose to 0.1% month-over-month, though they were still up 5.3% year-over-year, a slower pace for the category that includes Amazon, Etsy, Wayfair, and eBay.
Chapter 4: What insights does Goldman Sachs' Panic Index provide about market sentiment?
Among active stocks, Coca-Cola is lower after missing Q4 revenue expectations. The company sees full-year organic sales growth of about 4-5%, below the 5% consensus, with EPS growth of 7-8%. Datadog is rallying after beating Q4 expectations and issuing bullish Q1 guidance. The cloud security and monitoring platform sees first quarter 2026 revenue of about $956 million, above the 934 consensus.
And Spotify is also higher after guiding above expectations for subscriber metrics in the current quarter.
Chapter 5: What are the implications of current consumer spending patterns?
For Q1, total MAUs are seen rising about $9 million to $759 million, above the $752.45 billion consensus. In other news of note, Paramount Skydance sweetened its takeover bid for Warner Bros. Discovery by adding what's known as a ticking fee, paying Warner Bros. Discovery shareholders $0.25 per share for every quarter the deal isn't finalized after the end of the year.
That works out to roughly $650 million per quarter, aimed at easing concerns about regulatory delays. Paramount also said it would cover Warner's $2.8 billion termination fee to Netflix if Warner walks away from the current deal, and, if needed, backstop a debt refinancing and cover another $1.5 billion in related fees.
Warner said it will review the amended offer and later issue a board recommendation. And in the Wall Street Research Corner, Goldman Sachs' panic index is back near lofty historic levels. Analyst Gail Hafif said the latest reading is 9.22, based on a mix of one-month S&P implied volatility, VIX volatility, put-call skew, and the slope of the volatility term structure.
Hafif said those metrics suggest investors are not far from max fear.
That's all for today's Wall Street Lunch. Look for links for stories in the show notes section. Don't forget, these episodes will be up with transcriptions at seekingalpha.com. And make sure you're getting the most out of your portfolio with quant, news, and analysis by heading to seekingalpha.com.
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