Duolingo (NASDAQ:DUOL) Shares Gap Up After Analyst Upgrade

Key Points

• Duolingo shares jumped after DA Davidson upgraded the stock from “neutral” to “buy,” raising its price target from $130 to $160. Shares opened at $135.25, up from the prior close of $130.16.
• Analyst sentiment remains mixed: MarketBeat’s consensus rating is “Hold,” with an average price target of $130.50, despite several buy ratings and a range of targets from $80 to $160.
• Duolingo reported quarterly EPS of $0.66, beating estimates of $0.60, while revenue rose 18.3% year over year to $298.45 million. Institutional investors own 91.59% of the company’s stock.

Duolingo, Inc. (NASDAQ:DUOL - Get Free Report) shares gapped up before the market opened on Tuesday after DA Davidson upgraded the stock from a neutral rating to a buy rating. The stock had previously closed at $130.16, but opened at $135.25. DA Davidson now has a $160.00 price target on the stock, up from their previous price target of $130.00. Duolingo shares last traded at $136.6310, with a volume of 228,325 shares traded.

Other equities research analysts have also recently issued research reports about the company. Barclays increased their price target on Duolingo from $110.00 to $115.00 and gave the company an "equal weight" rating in a research note on Thursday, August 6th. Scotiabank set a $120.00 target price on Duolingo in a report on Thursday, August 6th. Weiss Ratings raised shares of Duolingo from a "sell (d+)" rating to a "hold (c-)" rating in a research report on Thursday, June 18th. Needham & Company LLC restated a "buy" rating and set a $145.00 price target on shares of Duolingo in a report on Thursday, August 6th. Finally, Wells Fargo & Company lowered their price target on shares of Duolingo from $82.00 to $80.00 and set an "underweight" rating for the company in a report on Friday, August 7th. One investment analyst has rated the stock with a Strong Buy rating, three have issued a Buy rating, seventeen have issued a Hold rating and two have assigned a Sell rating to the company's stock. According to MarketBeat, the stock presently has an average rating of "Hold" and a consensus price target of $130.50.

Institutional Inflows and Outflows

Hedge funds have recently made changes to their positions in the business. Public Employees Retirement System of Ohio bought a new stake in shares of Duolingo during the 2nd quarter valued at about $1,262,000. Generali Investments Management Co LLC acquired a new stake in Duolingo during the second quarter worth approximately $565,000. Everhart Financial Group Inc. bought a new stake in Duolingo in the second quarter worth approximately $313,000. FNY Investment Advisers LLC bought a new stake in Duolingo in the second quarter worth approximately $34,000. Finally, GAMMA Investing LLC increased its holdings in Duolingo by 103.1% in the second quarter. GAMMA Investing LLC now owns 1,324 shares of the company's stock worth $152,000 after purchasing an additional 672 shares in the last quarter. 91.59% of the stock is owned by institutional investors.

Duolingo Stock Performance

The company has a quick ratio of 2.72, a current ratio of 2.72 and a debt-to-equity ratio of 0.06. The company has a 50 day simple moving average of $128.62 and a 200-day simple moving average of $114.24. The stock has a market capitalization of $6.39 billion, a price-to-earnings ratio of 16.17, a price-to-earnings-growth ratio of 1.07 and a beta of 0.87.

Duolingo (NASDAQ:DUOL - Get Free Report) last posted its quarterly earnings results on Wednesday, August 5th. The company reported $0.66 earnings per share (EPS) for the quarter, topping analysts' consensus estimates of $0.60 by $0.06. The firm had revenue of $298.45 million for the quarter, compared to analysts' expectations of $295.58 million. Duolingo had a return on equity of 12.10% and a net margin of 35.88%.The company's revenue for the quarter was up 18.3% compared to the same quarter last year. During the same period in the prior year, the business earned $0.91 EPS. As a group, equities research analysts expect that Duolingo, Inc. will post 2.67 EPS for the current fiscal year.

About Duolingo

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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