US stocks decline amid earnings and geopolitical tensions; Walmart, Amazon, oil prices and jobless claims in focus

U.S. stocks experienced a decline on Thursday, February 18, 2026, as traders assessed recent quarterly results and monitored geopolitical tensions between the U.S. and Iran. The Dow Jones Industrial Average lost 187 points, or 0.4%, the S&P 500 slipped 0.3%, and the Nasdaq Composite declined 0.4%. Walmart shares saw a 2% increase after exceeding fourth-quarter expectations, though its full-year earnings outlook fell short. Crude prices rose over 1% to trade above $66 per barrel amid the standoff with Iran over its nuclear program.

Blue Owl shares fell 8.7% after the firm sold $1.4 billion of loan assets from three of its private debt funds. The sale was agreed upon with four North American pension and insurance investors, with the loans changing hands at 99.7% of par value. The largest portion of the sale came from the Blue Owl Capital Corporation II fund, a semi-liquid private credit strategy for U.S. retail investors.

Stephens downgraded The Cheesecake Factory to equal weight from overweight, reiterating a $65 price target, suggesting limited upside. The restaurant chain reported strong revenue and adjusted earnings per share for its fourth quarter, but also a 2.2% decline in same-store sales growth. Analysts noted that while the stock is up 22% year to date, growth is expected to slow.

Walmart was dethroned as the world's largest company by revenue by Amazon. Walmart reported revenue of $713.5 billion for the year ended January 31, while Amazon's 2025 net sales reached $716.9 billion. Both companies' revenues include more than just retail operations, with Amazon benefiting from its cloud computing and tech services, and Walmart from its growing advertising unit. Walmart's e-commerce and advertising businesses grew at double-digit paces in the fiscal fourth quarter, with Walmart Connect, its ad platform, growing revenue by 33%.

Hims & Hers Health added 4% premarket following the announcement of its acquisition of Australian digital health company Eucalyptus for up to $1.15 billion. Deere & Company shares rose 6% after reporting a beat on both revenue and earnings per share. Deere's first quarter earnings were $2.42 per share on revenue of $8 billion, exceeding analyst expectations.

Economic data released Thursday showed a slide in jobless claims, with initial claims totaling 206,000 for the week ending February 14, a decrease of 23,000 from the prior week. However, the trade deficit jumped to $70.3 billion in December, a significant increase from the previous month and higher than forecasts. The Philadelphia Federal Reserve's manufacturing index climbed to 16.3, its highest since September, but the employment index fell to its first negative reading since June 2025.

Raymond James upgraded Chewy to outperform from market perform, citing an attractive entry point following a significant pullback. The firm set a $28 price target, implying a 16% upside. Chewy shares have fallen 36% in the past 12 months and are down 27% this year, with a 33% stumble since its fiscal third-quarter earnings report.

Etsy shares jumped more than 20% premarket after announcing the sale of its resale platform Depop to eBay for $1.2 billion. The deal is expected to close in the second quarter of 2026.

Wayfair shares were down more than 6% despite reporting its first annual sales gain since 2020 and topping Q4 analyst expectations. The company earned an adjusted 85 cents per share in the final three months of the year on revenue of $3.34 billion.

Walmart shares fell 3% after its earnings forecast missed expectations. The company reported holiday-quarter sales rose nearly 6% and its quarterly earnings and revenue surpassed Wall Street's expectations. However, its full-year outlook for adjusted earnings per share ranged from $2.75 to $2.85, falling short of the $2.96 per share expected by analysts.

Valuations among the "Magnificent Seven" technology stocks have become less expensive but remain not cheap, according to Ed Yardeni of Yardeni Research. The group's forward price-to-sales ratio has fallen to 7.10 from its peak of 8.33 in November 2025, but remains higher than outside the past two years.

Investor David Einhorn, through Greenlight Capital, has been avoiding big tech and artificial intelligence beneficiaries, instead buying shares of Graphic Packaging, Capri Holdings, and healthcare stocks in the fourth quarter of 2025. He also established a position in software payments stock Global Payments.

In after-hours trading, DoorDash's stock price jumped about 10%, reversing an earlier decline, after reporting a 32% increase in total orders and a 38% rise in revenue for the fourth quarter, though results missed estimates. Figma shares jumped 16% after its fourth-quarter results and guidance surpassed expectations, with revenue growing 40% year-over-year. Etsy shares jumped nearly 16% after agreeing to sell Depop to eBay for $1.2 billion in cash. eBay stock rose more than 6%.

U.S. stock futures opened little changed on Wednesday evening, with the Dow Jones Industrial Average, S&P 500, and Nasdaq Composite each gaining less than 0.1%.

"A rebound in mega‑cap stocks, along with a pause in the rotation and broadening theme that has defined market performance this year, would not be surprising in the weeks ahead," said Edward Jones senior global investment strategist Angelo Kourkafas.

"Selling has been broad and indiscriminate, and in some cases, valuations may already reflect a substantial degree of disruption risk relative to current fundamentals," he added.

To be sure, Kourkafas said that even as pessimism in the tech sector has likely become overstated, the prospect of the group "regaining sustainable leadership remains doubtful" as the macroeconomic environment continues to favor cyclical stocks.

"We still view [The Cheesecake Factory] as a solid operator with a durable business, but feel that its valuation reflects its steady growth against a pressured backdrop," wrote analyst Jim Salera.

"Purely from a valuation standpoint, the Mag-7 isn't as expensive as it was, but it's not cheap either. The group's forward price-to-sales (P/S) ratio has fallen to 7.10, down from its November 3, 2025 peak of 8.33. But the P/S ratio remains higher than it has ever been outside of the past two years," he said in a note to clients.