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Evercore ISI raised its rating on Duolingo to Outperform, which is its way of saying the stock is likely to do better than the broader market. This is a major shift from a widely followed firm, suggesting that analysts are becoming more optimistic about the company's ability to keep growing its user base and profits.
While the average price target across all analysts sits at $141, this upgrade suggests that some firms now see the company as worth more than its current price. For a long-term owner, this move highlights growing confidence in Duolingo's transition from a simple language app into a broader education platform.
Wedbush raised its target for the stock from $139 to $150 but kept its rating at neutral, which means they are not yet advising people to buy. This is a small adjustment that brings their target closer to where the stock is currently trading. While the firm is not yet fully bullish, this move follows a week where other analysts have turned more positive. The average target across all firms now sits at $123, well below the current price, suggesting that many analysts are still catching up to the company's recent growth.
Source: Wedbush
The firm moved its rating from neutral to buy, signaling more confidence in the company's path forward. While the stock is currently trading around $140, the average price target across all analysts who follow the company sits lower at about $119.
This upgrade follows a period where the company has been focused on turning more of its 113 million monthly users into paying subscribers. A rating change like this often suggests an analyst believes the business is either more resilient or growing faster than they originally thought.
Duolingo officially filed notice that Sallie Krawcheck has joined its board of directors. Krawcheck is a well-known figure in finance, having previously led major divisions at Citigroup and Bank of America before founding Ellevest, an investment platform focused on women.
Adding a director with deep experience in large-scale finance and public markets is a common move for a younger company as it matures. Her background in consumer finance and scaling digital platforms should help the company as it tries to expand its paid subscription business and move into new subjects like math and music.
Source: 8-K filing
Duolingo is acquiring Animade, an award-winning animation studio in London. The move is designed to bring more high-quality motion design and character animation into the app, which is a core part of how the company keeps users coming back.
Duolingo relies on gamification, or using game-like features like streaks and animations, to turn a chore like language learning into a daily habit. By owning its own animation studio, the company can create more sophisticated visuals and characters more quickly. This supports the long-term goal of keeping engagement high as the platform expands into new subjects like music and math.
Source: GlobeNewsWire
Management has a strong habit of clearing the bar they set, with seven beats in the last eight quarters. This suggests the business is consistently outrunning even the most optimistic forecasts.
| Expectation | |
|---|---|
| EPS | $0.55 |
| Revenue | $303M |