Duolingo (NASDAQ:DUOL) Stock Keeps Buy Rating at DA Davidson

Key Points

• DA Davidson reaffirmed its Buy rating on Duolingo and set a $175 price target, implying approximately 25.6% upside from the prior close. However, the broader analyst consensus remains Hold, with an average target of $124.38.
• Duolingo shares rose 3.7% to $139.30. The company’s latest quarterly results modestly exceeded expectations, with EPS of $0.66 versus $0.60 expected and revenue of $298.45 million versus $295.58 million projected.
• Insiders sold 140,694 shares worth roughly $21.0 million over the past 90 days, including CEO Luis von Ahn’s sale of 46,682 shares valued at about $7.0 million under a pre-arranged Rule 10b5-1 plan.

Duolingo (NASDAQ:DUOL - Get Free Report)'s stock had its "buy" rating reaffirmed by equities research analysts at DA Davidson in a research note issued to investors on Tuesday, Benzinga reports. They presently have a $175.00 target price on the stock. DA Davidson's target price indicates a potential upside of 25.63% from the company's previous close.

Other research analysts also recently issued research reports about the company. KeyCorp raised Duolingo from a "hold" rating to an "overweight" rating in a report on Tuesday, August 18th. Wall Street Zen upgraded Duolingo from a "sell" rating to a "hold" rating in a research note on Sunday, August 16th. Argus reissued a "hold" rating and set a $146.00 price target on shares of Duolingo in a research report on Tuesday, August 25th. Jefferies Financial Group lifted their price target on shares of Duolingo from $95.00 to $125.00 and gave the stock a "hold" rating in a research note on Tuesday, July 14th. Finally, Truist Financial increased their price objective on shares of Duolingo from $100.00 to $120.00 and gave the company a "hold" rating in a research note on Thursday, August 6th. One research analyst has rated the stock with a Strong Buy rating, eight have given a Buy rating, fourteen have given a Hold rating and one has given a Sell rating to the company's stock. Based on data from MarketBeat.com, the company currently has a consensus rating of "Hold" and a consensus price target of $124.38.

Duolingo Stock Up 3.7%

Shares of NASDAQ DUOL traded up $5.00 on Tuesday, hitting $139.30. The company had a trading volume of 514,889 shares, compared to its average volume of 1,873,987. The firm has a market capitalization of $6.52 billion, a P/E ratio of 16.51, a PEG ratio of 1.18 and a beta of 0.89. Duolingo has a 12-month low of $87.89 and a 12-month high of $353.00. The business has a 50 day moving average of $141.33 and a two-hundred day moving average of $121.44. The company has a quick ratio of 2.72, a current ratio of 2.72 and a debt-to-equity ratio of 0.06.

Duolingo (NASDAQ:DUOL - Get Free Report) last posted its quarterly earnings data on Wednesday, August 5th. The company reported $0.66 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $0.60 by $0.06. The company had revenue of $298.45 million for the quarter, compared to analyst estimates of $295.58 million. Duolingo had a net margin of 35.88% and a return on equity of 12.10%. The business's quarterly revenue was up 18.3% on a year-over-year basis. During the same quarter last year, the firm posted $0.91 earnings per share. As a group, equities research analysts forecast that Duolingo will post 2.62 earnings per share for the current fiscal year.

Insider Activity at Duolingo

In other Duolingo news, insider Robert Meese sold 1,354 shares of the firm's stock in a transaction on Monday, August 17th. The stock was sold at an average price of $129.13, for a total value of $174,842.02. Following the sale, the insider directly owned 169,391 shares in the company, valued at approximately $21,873,459.83. This trade represents a 0.79% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this link. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CEO Luis van Ahn sold 46,682 shares of Duolingo stock in a transaction dated Thursday, September 24th. The shares were sold at an average price of $150.63, for a total transaction of $7,031,709.66. Following the completion of the sale, the chief executive officer owned 46,682 shares in the company, valued at approximately $7,031,709.66. This represents a 50.00% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 140,694 shares of company stock valued at $20,991,914 in the last ninety days. 16.62% of the stock is owned by insiders.

Hedge Funds Weigh In On Duolingo

Several large investors have recently bought and sold shares of the stock. Sequoia Financial Advisors LLC acquired a new position in Duolingo during the second quarter worth about $379,000. Integrated Wealth Concepts LLC acquired a new position in shares of Duolingo in the 2nd quarter worth approximately $328,000. IFP Advisors Inc raised its holdings in shares of Duolingo by 92.9% in the 2nd quarter. IFP Advisors Inc now owns 1,491 shares of the company's stock worth $171,000 after purchasing an additional 718 shares in the last quarter. Baird Financial Group Inc. lifted its stake in Duolingo by 881.9% during the second quarter. Baird Financial Group Inc. now owns 69,331 shares of the company's stock valued at $7,975,000 after purchasing an additional 62,270 shares during the last quarter. Finally, Allworth Financial LP lifted its stake in Duolingo by 268.9% during the second quarter. Allworth Financial LP now owns 1,907 shares of the company's stock valued at $219,000 after purchasing an additional 1,390 shares during the last quarter. Institutional investors and hedge funds own 91.59% of the company's stock.

Duolingo News Roundup

Here are the key news stories impacting Duolingo this week:

• Positive Sentiment: DA Davidson reaffirmed its Buy rating and set a $175 price target, implying roughly 25% upside from the recent trading level. The endorsement supports the view that Duolingo’s sharp selloff has created an attractive entry point. Benzinga analyst rating report
• Positive Sentiment: A bullish investment analysis argues that Duolingo’s proprietary user data, A/B-testing capabilities and AI-powered personalization form a defensible competitive advantage. AI could also accelerate content development, reduce costs and help the company expand into additional educational categories. Duolingo valuation and competitive advantage analysis
• Positive Sentiment: Indonesia was identified as one of Duolingo’s fastest-growing markets, highlighting continued international user-growth opportunities. Duolingo Indonesia growth report
• Neutral Sentiment: Duolingo is attracting increased attention from Zacks users, which may improve near-term trading interest but does not itself represent a change in fundamentals or earnings expectations. Zacks trending stock report
• Negative Sentiment: CEO and co-founder Luis von Ahn sold 46,682 shares valued at approximately $7.0 million, reducing his direct ownership by 50%. The transactions were conducted under a pre-arranged Rule 10b5-1 plan, which lessens—but does not eliminate—the negative signaling effect of insider selling. SEC insider trading filing
• Negative Sentiment: The stock recently suffered a steep decline, while the broader analyst consensus remains Hold with an average price target below the current market level. This creates an overhang despite Duolingo’s latest earnings and revenue modestly exceeding expectations.

About Duolingo

Duolingo, Inc develops digital learning products designed to make education accessible through mobile devices and the web. Its primary product is the Duolingo language-learning platform, which offers courses in numerous languages through interactive, game-like lessons, practice exercises and personalized learning features.

The company also provides the Duolingo English Test, an online English-proficiency assessment used by educational institutions and other organizations. In addition, Duolingo has expanded beyond language learning with products such as Duolingo Math and Duolingo Music, while offering premium subscription features through plans including Super Duolingo and Duolingo Max.

Duolingo serves users internationally, with its applications and online services available across a broad range of geographies.