Duolingo (NASDAQ:DUOL) Rating Increased to Strong-Buy at UBS Group

UBS Group upgraded shares of Duolingo (NASDAQ:DUOL) to a strong-buy rating in a report published on Thursday morning,Zacks.com reports.

A number of other research analysts have also commented on DUOL. DA Davidson upped their price target on Duolingo from $120.00 to $130.00 and gave the company a “neutral” rating in a research report on Thursday. Zacks Research raised Duolingo from a “strong sell” rating to a “hold” rating in a research note on Tuesday, April 28th. Morgan Stanley upped their target price on Duolingo from $95.00 to $125.00 and gave the company an “equal weight” rating in a report on Thursday, July 16th. Wells Fargo & Company dropped their price target on Duolingo from $82.00 to $80.00 and set an “underweight” rating for the company in a research note on Friday. Finally, Barclays raised their price target on Duolingo from $110.00 to $115.00 and gave the stock an “equal weight” rating in a research note on Thursday. One analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating, eighteen have issued a Hold rating and two have assigned a Sell rating to the stock. According to MarketBeat, the company presently has a consensus rating of “Hold” and a consensus target price of $148.12.

Duolingo Stock Up 6.8%

DUOL opened at $130.90 on Thursday. The business’s 50-day moving average price is $125.76 and its 200-day moving average price is $115.10. The company has a current ratio of 2.72, a quick ratio of 2.62 and a debt-to-equity ratio of 0.06. Duolingo has a 12 month low of $87.89 and a 12 month high of $415.76. The company has a market cap of $6.10 billion, a P/E ratio of 15.51, a P/E/G ratio of 0.95 and a beta of 0.87.

Duolingo (NASDAQ:DUOL) last announced its quarterly earnings data on Wednesday, August 5th. The company reported $0.66 earnings per share for the quarter, beating the consensus estimate of $0.60 by $0.06. Duolingo had a return on equity of 12.10% and a net margin of 35.88%.The firm had revenue of $298.45 million during the quarter, compared to the consensus estimate of $295.58 million. During the same quarter in the previous year, the company posted $0.91 earnings per share. The business’s revenue was up 18.3% on a year-over-year basis. On average, equities analysts expect that Duolingo will post 2.76 EPS for the current year.

Insider Buying and Selling at Duolingo

In other news, insider Natalie Glance sold 3,360 shares of the stock in a transaction that occurred on Monday, May 18th. The stock was sold at an average price of $113.59, for a total value of $381,662.40. Following the completion of the transaction, the insider owned 173,401 shares of the company’s stock, valued at approximately $19,696,619.59. This represents a 1.90% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. 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. Also, insider Robert Meese sold 1,420 shares of the firm’s stock in a transaction that occurred on 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 transaction, the insider owned 170,745 shares of the company’s stock, valued at approximately $19,150,759.20. The trade was a 0.82% decrease in their position. The SEC filing for this sale provides additional information. The sale was made to cover tax withholding obligations related to the vesting of equity awards. In the last three months, insiders have sold 9,506 shares of company stock valued at $1,073,864. 16.62% of the stock is currently owned by corporate insiders.

Institutional Investors Weigh In On Duolingo

Several hedge funds and other institutional investors have recently added to or reduced their stakes in DUOL. Baillie Gifford & Co. increased its position in Duolingo by 71.9% during the 4th quarter. Baillie Gifford & Co. now owns 4,861,445 shares of the company’s stock valued at $853,184,000 after buying an additional 2,033,611 shares in the last quarter. Lingotto Investment Management LLP raised its stake in Duolingo by 34.3% during the fourth quarter. Lingotto Investment Management LLP now owns 33,563 shares of the company’s stock valued at $5,890,000 after buying an additional 8,563 shares during the last quarter. Landscape Capital Management L.L.C. bought a new stake in Duolingo in the fourth quarter worth $3,752,000. Peregrine Capital Management LLC boosted its holdings in Duolingo by 50.3% in the fourth quarter. Peregrine Capital Management LLC now owns 129,515 shares of the company’s stock worth $22,730,000 after acquiring an additional 43,352 shares in the last quarter. Finally, Investment House LLC grew its stake in shares of Duolingo by 250.7% in the fourth quarter. Investment House LLC now owns 18,038 shares of the company’s stock worth $3,166,000 after acquiring an additional 12,894 shares during the last quarter. 91.59% of the stock is owned by hedge funds and other institutional investors.

Duolingo News Summary

Here are the key news stories impacting Duolingo this week:

• Positive Sentiment: Duolingo exceeded second-quarter expectations, reporting adjusted earnings of $0.66 per share versus consensus of roughly $0.60-$0.61, while revenue rose 18.3% year over year to $298.5 million, above the $295.6 million estimate. DUOL Q2 Earnings Beat Estimates on Strong User Growth
• Positive Sentiment: Daily active users increased 23% year over year, and paid subscribers continued to grow, reinforcing Duolingo’s long-term expansion strategy. Management also cited lower artificial-intelligence costs as a factor supporting profitability. Duolingo stock sinks 15% as Q3 revenue forecast misses expectations
• Positive Sentiment: Needham reaffirmed its Buy rating and set a $145 price target, while Truist raised its target to $120 from $100, indicating some analysts see value after the recent selloff. Analyst ratings and price targets
• Neutral Sentiment: Management is prioritizing engagement and user growth, targeting 100 million daily active users by 2028, but projected 2026 revenue growth of approximately 16% signals a materially slower pace than Duolingo’s historical expansion. Duolingo outlines 2026 revenue growth of approximately 16%
• Negative Sentiment: The main overhang is Duolingo’s third-quarter revenue forecast, which fell below Wall Street expectations. The guidance overshadowed the earnings and user-growth beats, prompting a sharp post-earnings selloff and raising concerns that the company’s growth engine is slowing. Duolingo posts better-than-expected sales but stock drops
• Negative Sentiment: Bank of America downgraded Duolingo to Underperform, and Truist’s Hold rating with a $120 target remains below the recent trading level, reflecting valuation and execution concerns. Bank of America downgrades Duolingo

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.