Is Duolingo Stock a Good Investment?

Duolingo Investment Advice

  DUOL
To provide specific investment advice or recommendations on Duolingo stock, we recommend investors consider the following general factors when evaluating Duolingo. This will help you to make an informed decision on whether to include Duolingo in one of your diversified portfolios:
  • Examine Duolingo's financial health by looking at its balance sheet, income statement, and cash flow statement. Analyze key financial ratios, such as Price-to-Earnings (P/E), Price-to-Sales (P/S), and Price-to-Book (P/B), to determine whether the stock is fairly valued or over/undervalued.
  • Research Duolingo's leadership team and their track record. Good management can help Duolingo navigate difficult times and make strategic decisions that benefit shareholders and increases its net worth.
  • Consider the overall health of the Diversified Consumer Services space and any emerging trends that could impact Duolingo's business and its evolving consumer preferences.
  • Compare Duolingo's performance and market position to its competitors. Analyze how Duolingo is positioned in terms of product offerings, innovation, and market share.
  • Check if Duolingo pays a dividend and its dividend yield and payout ratio.
  • Review what financial analysts are saying about Duolingo's stock and their price targets. However, remember that analysts' opinions can vary, and their predictions may not always be accurate.
It's important to note that investing in Duolingo stock, carries risks, and you should carefully consider your investment goals and risk tolerance before making any investment decisions. Also, remember that it's important for investors to have a long-term perspective and a well-diversified portfolio to manage the impact of stock market volatility on their investments. Below is a detailed guide on how to decide if Duolingo is a good investment.
 
Sell
 
Buy
Strong Buy
Macroaxis provides advice on Duolingo to complement and cross-verify current analyst consensus on Duolingo. Our investment recommendation engine determines the company's potential to grow exclusively from the perspective of an investor's current risk tolerance and investing horizon. To make sure Duolingo is not overpriced, please confirm all Duolingo fundamentals, including its price to sales, book value per share, working capital, as well as the relationship between the cash and equivalents and target price . Given that Duolingo has a number of shares shorted of 1.44 M, we urge you to verify Duolingo market performance and probability of bankruptcy to ensure the company can sustain itself in the current economic cycle given your prevailing risk tolerance and investing horizon.

Market Performance

Very WeakDetails

Volatility

Very steadyDetails

Hype Condition

Low keyDetails

Current Valuation

Fairly ValuedDetails

Odds Of Distress

Very LowDetails

Economic Sensitivity

Slowly supersedes the marketDetails

Investor Sentiment

AlarmedDetails

Analyst Consensus

BuyDetails

Financial Strenth (F Score)

StrongDetails

Financial Leverage

Not RatedDetails

Reporting Quality (M-Score)

Unlikely ManipulatorDetails

Examine Duolingo Stock

Researching Duolingo's stock involves analyzing various aspects of the company and its industry to make an informed investment decision. The key areas to focus on are fundamentals, business model and competitive advantage. It is also important to analyze trends in revenue, net income, and cash flow, as well as key financial ratios, such as price-to-earnings (P/E), price-to-sales (P/S), and debt-to-equity (D/E). About 96.0% of the company shares are held by institutions such as insurance companies. The company had not issued any dividends in recent years.
To determine if Duolingo is a good investment, evaluating the company's potential for future growth is also very important. This may include expanding into new markets, launching new products or services, or improving operational efficiency. Companies with strong growth prospects can be more attractive investments. This aspect of the research should be conducted in the context of the overall market and industry in which the company operates and should include an analysis of growth potential, competitive landscape, and any regulatory or economic factors that could impact the business. Some of the essential points regarding Duolingo's research are outlined below:
Duolingo generated a negative expected return over the last 90 days
Duolingo has high historical volatility and very poor performance
Duolingo has a strong financial position based on the latest SEC filings
Over 96.0% of the company shares are held by institutions such as insurance companies
Latest headline from gurufocus.com: Why Duolingo Stock Is Dropping Today

Duolingo Quarterly Gross Profit

140.41 Million

Duolingo uses earnings reports to provide investors with an update of all three financial statements, including the income statement, the balance sheet, and the cash flow statement. Therefore, it is also crucial when considering investing in Duolingo. Every quarterly earnings report provides investors with an overview of sales, expenses, and net income for the most recent period. It also may provide a comparison to Duolingo's previous reporting period. The quarterly earnings reports are usually disseminated to the public via Form 10-Q, which is a legal document filed with the Securities and Exchange Commission every quarter.
27th of February 2024
Upcoming Quarterly Report
View
14th of May 2024
Next Financial Report
View
31st of December 2023
Next Fiscal Quarter End
View
27th of February 2024
Next Fiscal Year End
View
30th of September 2023
Last Quarter Report
View
31st of December 2022
Last Financial Announcement
View
Earnings surprises can significantly impact Duolingo's stock price both in the short term and over time. Negative earnings surprises usually result in a price decline. However, it has been seen that positive earnings surprises lead to an immediate rise in a stock's price and a gradual increase over time. This is why we often hear news about some companies beating earning projections. Financial analysts spend a large amount of time predicting earnings per share (EPS) along with other important future indicators. Many analysts use forecasting models, management guidance, and additional fundamental information to derive an EPS estimate. Below are the table of largest EPS Surprises Duolingo's investors have experienced.
Reported
Fiscal Date
Estimated EPS
Reported EPS
Surprise
2024-02-28
2023-12-310.170.260.0952 
2022-11-10
2022-09-30-0.55-0.460.0916 
2022-08-04
2022-06-30-0.52-0.380.1426 
2024-11-07
2024-09-300.9351.0780.14315 
2023-11-08
2023-09-30-0.110.060.17154 
2023-05-09
2023-03-31-0.23-0.060.1773 
2023-02-28
2022-12-31-0.53-0.350.1833 
2024-08-07
2024-06-300.320.510.1959 

Duolingo Target Price Consensus

Duolingo target price is determined by taking all analyst projections and averaging them out. There is no one specific way to measure analysts' performance other than comparing it to past results via a very sophisticated attribution analysis. Duolingo's target price projections below should be used in combination with other traditional price prediction techniques such as stock price forecasting, investor sentiment analysis, technical analysis, earnings estimate, and various momentum models.
   20  Buy
Most Duolingo analysts issue ratings four times a year, at intervals of three months. Ratings are usually accompanied by a target price to help potential investors understand Duolingo stock's fair price compared to its market value. Analysts arrive at stock ratings after researching the public financial statements of Duolingo, talking to its executives and customers, or listening to those companies' conference calls.
Macroaxis Advice   Exposure   Valuation

Duolingo Target Price Projection

Duolingo's current and average target prices are 312.07 and 347.91, respectively. The current price of Duolingo is the price at which Duolingo is currently trading. On the other hand, Duolingo's target price is what analysts think the stock is worth or could sell for in the future. The more significant the discrepancy between the two prices, the more it stimulates investors to act.

Current Price

Duolingo Market Quote on 1st of March 2025

Low Price303.68Odds
High Price329.61Odds

312.07

Target Price

Analyst Consensus On Duolingo Target Price

Low Estimate316.6Odds
High Estimate386.18Odds

347.9121

Historical Lowest Forecast  316.6 Target Price  347.91 Highest Forecast  386.18
Note that most analysts generally publish their price targets in research reports on specific companies, along with recommendations for the company's stock.Although price targets are often quoted in the financial news media, there could be a delay between the publication of the latest analyst outlook on Duolingo and the information provided on this page.

Duolingo Analyst Ratings

Duolingo's analyst stock recommendations are determined by taking an average estimate of all analysts we track and classifying them as Strong Buy, Buy, Hold, Strong Sell, or Sell. Ratings generally communicate what analysts sense about Duolingo stock, and they use a lot of effort and time to analyze it and arrive at a rating. That suggests that analyst recommendations are the outcome of an objective and thorough examination of Duolingo's financials, market performance, and future outlook by experienced professionals. Duolingo's historical ratings below, therefore, can serve as a valuable tool for investors.

Know Duolingo's Top Institutional Investors

Have you ever been surprised when a price of an equity instrument such as Duolingo is soaring high without any particular reason? This is usually happening because many institutional investors are aggressively trading Duolingo backward and forwards among themselves. Duolingo's institutional investor refers to the entity that pools money to purchase Duolingo's securities or originate loans. Institutional investors include commercial and private banks, credit unions, insurance companies, pension funds, hedge funds, endowments, and mutual funds. Operating companies that invest excess capital in these types of assets may also be included in the term and may influence corporate governance by exercising voting rights in their investments.
Shares
State Street Corp2024-12-31
1.1 M
Bank Of New York Mellon Corp2024-12-31
430 K
Marshall Wace Asset Management Ltd2024-12-31
388.7 K
International Assets Investment Management, Llc2024-09-30
355.1 K
Northern Trust Investments N A2024-12-31
296.5 K
Agf Management Ltd2024-12-31
265.8 K
Jpmorgan Chase & Co2024-09-30
244.5 K
Lord, Abbett & Co Llc2024-12-31
181.5 K
First Trust Advisors L.p.2024-12-31
177.2 K
Note, although Duolingo's institutional investors appear to be way more sophisticated than retail investors, it remains unclear if professional active investment managers can reliably enhance risk-adjusted returns by an amount that exceeds fees and expenses.

Duolingo's market capitalization trends

The company currently falls under 'Large-Cap' category with a current market capitalization of 17 B.

Market Cap

14.61 Billion

Duolingo's profitablity analysis

Last ReportedProjected for Next Year
Return On Tangible Assets 0.07  0.07 
Return On Capital Employed 0.07  0.07 
Return On Assets 0.07  0.07 
Return On Equity 0.11  0.11 
The company has Profit Margin (PM) of 0.13 %, which maeans that even a very small decline in it revenue will erase profits resulting in a net loss. This is way below average. Similarly, it shows Operating Margin (OM) of 0.07 %, which suggests for every 100 dollars of sales, it generated a net operating income of $0.07.
Determining Duolingo's profitability involves analyzing its financial statements and using various financial metrics to determine if Duolingo is a good buy. For example, gross profit margin measures Duolingo's profitability after accounting for the cost of goods sold, while net profit margin measures profitability after accounting for all expenses. Other important metrics include return on assets, return on equity, and free cash flow. By reviewing multiple sources and metrics, you can gain a complete picture of Duolingo's profitability and make more informed investment decisions.

Evaluate Duolingo's management efficiency

Duolingo has return on total asset (ROA) of 0.0325 % which means that it generated a profit of $0.0325 on every $100 spent on assets. This is way below average. Similarly, it shows a return on stockholder's equity (ROE) of 0.1208 %, meaning that it created $0.1208 on every $100 dollars invested by stockholders. Duolingo's management efficiency ratios could be used to measure how well Duolingo manages its routine affairs as well as how well it operates its assets and liabilities. Return On Tangible Assets is expected to rise to 0.07 this year. Return On Capital Employed is expected to rise to 0.07 this year. At this time, Duolingo's Debt To Assets are quite stable compared to the past year. Return On Assets is expected to rise to 0.07 this year, although the value of Non Current Assets Total will most likely fall to about 42.3 M.
Last ReportedProjected for Next Year
Book Value Per Share 17.30  18.16 
Tangible Book Value Per Share 16.66  17.49 
Enterprise Value Over EBITDA 235.26  247.02 
Price Book Value Ratio 18.75  19.68 
Enterprise Value Multiple 235.26  247.02 
Price Fair Value 18.75  19.68 
Enterprise Value13.3 B13.9 B
The management team at Duolingo has a track record of steering the company towards sustained growth. Evaluating their strategies helps in understanding the stock's long-term potential.
Beta
0.885

Basic technical analysis of Duolingo Stock

As of the 1st of March, Duolingo shows the Mean Deviation of 2.39, standard deviation of 3.63, and Variance of 13.19. Duolingo technical analysis allows you to utilize historical prices and volume patterns in order to determine a pattern that computes the direction of the firm's future prices. Please confirm Duolingo variance and potential upside to decide if Duolingo is priced favorably, providing market reflects its regular price of 312.07 per share. Given that Duolingo has information ratio of (0.02), we urge you to verify Duolingo's prevailing market performance to make sure the company can sustain itself at a future point.

Duolingo's insider trading activities

Some recent studies suggest that insider trading raises the cost of capital for securities issuers and decreases overall economic growth. Trading by specific Duolingo insiders, such as employees or executives, is commonly permitted as long as it does not rely on Duolingo's material information that is not in the public domain. Local jurisdictions usually require such trading to be reported in order to monitor insider transactions. In many U.S. states, trading conducted by corporate officers, key employees, directors, or significant shareholders must be reported to the regulator or publicly disclosed, usually within a few business days of the trade. In these cases Duolingo insiders are required to file a Form 4 with the U.S. Securities and Exchange Commission (SEC) when buying or selling shares of their own companies.

Duolingo's Outstanding Corporate Bonds

Duolingo issues bonds to finance its operations. Corporate bonds make up one of the largest components of the U.S. bond market, which is considered the world's largest securities market. Duolingo uses the proceeds from bond sales for a wide variety of purposes, including financing ongoing mergers and acquisitions, buying new equipment, investing in research and development, buying back their own stock, paying dividends to shareholders, and even refinancing existing debt. Most Duolingo bonds can be classified according to their maturity, which is the date when Duolingo has to pay back the principal to investors. Maturities can be short-term, medium-term, or long-term (more than ten years). Longer-term bonds usually offer higher interest rates but may entail additional risks.

Understand Duolingo's technical and predictive indicators

Using predictive indicators to make investment decisions involves analyzing Duolingo's various financial and market-based factors to help forecast future trends and identify investment opportunities. Select the indicators that are most relevant to your investment strategy. Each indicator has its own strengths and weaknesses, so it's essential to combine multiple indicators to get a more comprehensive view of the market and reduce the risk of making poor decisions based on limited data.

Consider Duolingo's intraday indicators

Duolingo intraday indicators are useful technical analysis tools used by many experienced traders. Just like the conventional technical analysis, daily indicators help intraday investors to analyze the price movement with the timing of Duolingo stock daily movement. By combining multiple daily indicators into a single trading strategy, you can limit your risk while still earning strong returns on your managed positions.

Duolingo Corporate Filings

10K
28th of February 2025
Annual report required by the U.S. Securities and Exchange Commission (SEC) of a company financial performance
ViewVerify
8K
27th of February 2025
Report filed with the SEC to announce major events that shareholders should know about
ViewVerify
F4
25th of February 2025
The report filed by a party regarding the acquisition or disposition of a company's common stock, as well as derivative securities such as options, warrants, and convertible securities
ViewVerify
14th of February 2025
Other Reports
ViewVerify
Duolingo time-series forecasting models is one of many Duolingo's stock analysis techniques aimed to predict future share value based on previously observed values. Time-series forecasting models ae widely used for non-stationary data. Non-stationary data are called the data whose statistical properties e.g. the mean and standard deviation are not constant over time but instead, these metrics vary over time. These non-stationary Duolingo's historical data is usually called time-series. Some empirical experimentation suggests that the statistical forecasting models outperform the models based exclusively on fundamental analysis to predict the direction of the market movement and maximize returns from investment trading.

Duolingo Stock media impact

Far too much social signal, news, headlines, and media speculation about Duolingo that are available to investors today. That information is available publicly through Duolingo media outlets and privately through word of mouth or via Duolingo internal channels. However, regardless of the origin, that massive amount of Duolingo data is challenging to quantify into actionable patterns, especially for investors that are not very sophisticated with ever-evolving tools and techniques used in the investment management field.
A primary focus of Duolingo news analysis is to determine if its current price reflects all relevant headlines and social signals impacting the current market conditions. A news analyst typically looks at the history of Duolingo relative headlines and hype rather than examining external drivers such as technical or fundamental data. It is believed that price action tends to repeat itself due to investors' collective, patterned thinking related to Duolingo's headlines and news coverage data. This data is often completely overlooked or insufficiently analyzed for actionable insights to drive Duolingo alpha.

Duolingo Sentiment by Major News Outlets

Investor sentiment, mood or attitude towards Duolingo can have a significant impact on its stock price or the market as a whole. This sentiment can be positive or negative, and various factors, such as economic indicators, news events, or market trends, can influence it. When investor sentiment is positive, investors are more likely to buy stocks, increasing demand and increasing the stock price. Positive investor sentiment can be driven by good news about the company or the broader market, such as solid earnings reports or positive economic data.
Note that negative investor sentiment can cause investors to sell stocks, leading to a decrease in demand and a drop in the stock price. Negative sentiment can be driven by factors such as poor earnings reports, negative news about the company or industry, or broader economic concerns. It's important to note that investor sentiment is just one of many factors that can affect stock prices. Other factors, such as company performance, industry trends, and global economic conditions, can also play a significant role in determining the value of a stock.

Duolingo Historical Investor Sentiment

Investor biases related to Duolingo's public news can be used to forecast risks associated with an investment in Duolingo. The trend in average sentiment can be used to explain how an investor holding Duolingo can time the market purely based on public headlines and social activities around Duolingo. Please note that most equities that are difficult to arbitrage are affected by market sentiment the most.
Duolingo's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Duolingo and other traded tickers. The bigger the bubble, the more accurate the estimated score. Higher bars for a given day show more participation in the average Duolingo news discussions. The higher the estimate score, the more favorable the investor's outlook on Duolingo.

Duolingo Maximum Pain Price Across May 16th 2025 Option Contracts

Duolingo's options can also be used to analyze investors' bias and current market sentiment in the context of behavioral finance. For example, Max pain usually refers to a trading concept that asserts that market manipulation can cause the market price of Duolingo close to the expiration of its current option contract to expire worthlessly. According to most research, about 35% of options are not executed, with roughly 50% traded out before expiration. So, Max pain occurs when market makers reach a net favorable position across all options at a strike price where option holders stand to lose the most money. By contrast, option sellers may reap the most after selling more options than buying, causing them to expire worthlessly. Please continue to view the detailed analysis of Duolingo's options.

Duolingo Corporate Management

Stephen ChenGeneral CounselProfile
Linda SimenskyHead ContentProfile
Sam DalsimerGlobal CommunicationsProfile
Molly LindsayChief OfficerProfile
Robert MeeseChief OfficerProfile
Kendra RossHead ImpactProfile
Cambria DunawayChief OfficerProfile
When determining whether Duolingo is a strong investment it is important to analyze Duolingo's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Duolingo's future performance. For an informed investment choice regarding Duolingo Stock, refer to the following important reports:
Check out Investing Opportunities to better understand how to build diversified portfolios, which includes a position in Duolingo. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in persons.
For more information on how to buy Duolingo Stock please use our How to buy in Duolingo Stock guide.
You can also try the Financial Widgets module to easily integrated Macroaxis content with over 30 different plug-and-play financial widgets.
Is Diversified Consumer Services space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Duolingo. If investors know Duolingo will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Duolingo listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
7.167
Earnings Share
1.82
Revenue Per Share
16.035
Quarterly Revenue Growth
0.399
Return On Assets
0.0325
The market value of Duolingo is measured differently than its book value, which is the value of Duolingo that is recorded on the company's balance sheet. Investors also form their own opinion of Duolingo's value that differs from its market value or its book value, called intrinsic value, which is Duolingo's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Duolingo's market value can be influenced by many factors that don't directly affect Duolingo's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
In summary, please note that there is a difference between Duolingo's value and its price, as these two are different measures arrived at by various means. Investors typically determine if Duolingo is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Duolingo's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.