Duolingo (NASDAQ:DUOL) Earns Neutral Rating from DA Davidson

Key Points

• DA Davidson reaffirmed a neutral rating on Duolingo and set a $120 price target, which implies downside from the stock’s current level.
• Duolingo’s latest earnings topped expectations, with EPS of $0.89 versus the $0.79 consensus and revenue of $291.97 million, up 26.5% year over year.
• The stock rose 1.2% to $129.57, while analyst sentiment remains cautious overall: the consensus rating is Hold and the average price target is $197.61.

Duolingo (NASDAQ:DUOL - Get Free Report)'s stock had its "neutral" rating reaffirmed by stock analysts at DA Davidson in a research report issued to clients and investors on Wednesday,Benzinga reports. They currently have a $120.00 price objective on the stock. DA Davidson's price target would indicate a potential downside of 7.39% from the stock's current price.

Several other analysts have also issued reports on DUOL. Bank of America reiterated a "neutral" rating and set a $100.00 target price on shares of Duolingo in a report on Friday, February 27th. Argus reiterated a "hold" rating on shares of Duolingo in a report on Wednesday, March 18th. Zacks Research upgraded Duolingo from a "strong sell" rating to a "hold" rating in a report on Tuesday, April 28th. JPMorgan Chase & Co. upped their target price on Duolingo from $92.00 to $94.00 and gave the stock a "neutral" rating in a report on Tuesday, May 5th. Finally, UBS Group reiterated a "neutral" rating on shares of Duolingo in a report on Wednesday. Two research analysts have rated the stock with a Buy rating, eighteen have assigned a Hold rating and two have issued a Sell rating to the company's stock. According to data from MarketBeat.com, the company presently has a consensus rating of "Hold" and a consensus price target of $197.61.

Duolingo Stock Up 1.2%

NASDAQ DUOL traded up $1.50 on Wednesday, reaching $129.57. The company had a trading volume of 553,940 shares, compared to its average volume of 2,255,975. The firm has a market capitalization of $6.04 billion, a price-to-earnings ratio of 14.95, a price-to-earnings-growth ratio of 0.96 and a beta of 0.89. The company has a debt-to-equity ratio of 0.07, a quick ratio of 2.62 and a current ratio of 2.62. Duolingo has a 1-year low of $87.89 and a 1-year high of $483.03. The company's fifty day moving average is $107.33 and its 200-day moving average is $128.98.

Duolingo (NASDAQ:DUOL - Get Free Report) last posted its quarterly earnings data on Monday, May 4th. The company reported $0.89 EPS for the quarter, topping analysts' consensus estimates of $0.79 by $0.10. The company had revenue of $291.97 million during the quarter, compared to the consensus estimate of $288.60 million. Duolingo had a net margin of 38.44% and a return on equity of 14.07%. The company's quarterly revenue was up 26.5% on a year-over-year basis. During the same period in the prior year, the business posted $0.72 EPS. On average, research analysts forecast that Duolingo will post 2.84 earnings per share for the current fiscal year.

Insider Activity at Duolingo

In related news, insider Robert Meese sold 1,420 shares of the firm's stock in a transaction dated Friday, May 15th. The shares were sold at an average price of $112.16, for a total value of $159,267.20. Following the completion of the sale, the insider directly owned 170,745 shares in the company, valued at approximately $19,150,759.20. This trade represents a 0.82% decrease in their position. The sale was disclosed in a document filed with the SEC, which is accessible through the SEC website. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, General Counsel Stephen C. Chen sold 1,977 shares of the firm's stock in a transaction dated Monday, May 18th. The shares were sold at an average price of $113.61, for a total transaction of $224,606.97. Following the completion of the sale, the general counsel owned 52,807 shares of the company's stock, valued at $5,999,403.27. This trade represents a 3.61% 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. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last ninety days, insiders sold 9,506 shares of company stock worth $1,073,864. Insiders own 16.62% of the company's stock.

Institutional Investors Weigh In On Duolingo

Several hedge funds have recently bought and sold shares of the company. Baillie Gifford & Co. lifted its stake in Duolingo by 71.9% in the 4th quarter. Baillie Gifford & Co. now owns 4,861,445 shares of the company's stock valued at $853,184,000 after purchasing an additional 2,033,611 shares during the last quarter. Capital World Investors raised its holdings in Duolingo by 0.5% in the 4th quarter. Capital World Investors now owns 2,241,378 shares of the company's stock valued at $393,362,000 after acquiring an additional 11,140 shares during the period. Bank of America Corp DE raised its holdings in Duolingo by 511.2% in the 1st quarter. Bank of America Corp DE now owns 1,332,301 shares of the company's stock valued at $131,325,000 after acquiring an additional 1,114,315 shares during the period. State of Michigan Retirement System raised its holdings in Duolingo by 112.9% in the 1st quarter. State of Michigan Retirement System now owns 1,193,307 shares of the company's stock valued at $117,624,000 after acquiring an additional 632,807 shares during the period. Finally, State Street Corp raised its holdings in Duolingo by 0.5% in the 2nd quarter. State Street Corp now owns 1,164,387 shares of the company's stock valued at $477,422,000 after acquiring an additional 6,109 shares during the period. 91.59% of the stock is currently owned by institutional investors and hedge funds.

Duolingo Company Profile

Duolingo, Inc NASDAQ: DUOL is a technology-driven education company that operates a widely used language-learning platform. Founded in 2011 by Luis von Ahn and Severin Hacker, Duolingo offers a freemium service featuring bite-sized lessons, gamified exercises and adaptive learning algorithms. The company's core product is its mobile and web application, which supports instruction in more than 40 languages, ranging from widely spoken tongues such as English and Spanish to lesser-taught options including Irish and Swahili.

In addition to its flagship language courses, Duolingo has expanded its product suite to include the Duolingo English Test, an on-demand, computer-based English proficiency exam designed for academic and professional admissions.

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