Key Stats for Duolingo Stock
- Price change for Duolingo stock in last 6 months: 57%
- $DUOL Stock Price as of Sep. 1: $159
- 52-Week High: $353
- $DUOL Stock Price Target: $134
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What Happened?
Duolingo (DUOL) stock got a boost after Evercore ISI analyst Mark Mahaney upgraded the stock to Outperform from In Line, setting a new price target of $210.
That target implies over 40% upside, based on 20 times Duolingo’s projected 2028 EBITDA.
Mahaney’s upgrade came after a mix of research, including a proprietary survey, an analysis of recent product improvements, a new sensitivity model tied to reaching 100 million daily active users, third-party DAU tracking, and recent channel checks.
He also raised his earnings estimates significantly, putting his 2027 EPS forecast 10% above Wall Street’s average and his 2028 forecast 25% above.
Interestingly, Mahaney compared the setup to Netflix’s 2022 turnaround, when that stock fell 70% before product changes drove a real recovery and outperformance.
He noted that Duolingo’s valuation isn’t quite as attractive as Netflix’s was back then, and Duolingo doesn’t have Netflix’s scale.
Still, he sees enough similarities to make the comparison worthwhile.
DA Davidson analyst Wyatt Swanson also raised his price target on Duolingo, moving it to $175 from $160, while keeping his Buy rating in place.
Swanson’s team tracks data from over 170,000 existing Duolingo users, and that data shows week-over-week daily active user growth continuing to strengthen.
He noted the final week of August showed another step-up, now pointing to Q3 DAU growth possibly landing between 25.6% and 27.6% year-over-year.
According to his tracking, August DAUs rose 1.3% month over month, with the last week marking the strongest week-over-week growth since the company’s Streak Revival event in early June.
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What the Market Is Telling Us About Duolingo Stock
The rally in Duolingo stock shows the market responding to real, trackable user growth data rather than just optimism. Duolingo’s own Q2 results back this up.
The company reported daily active user growth of 23% year-over-year, an acceleration from the first quarter and slightly ahead of internal expectations. Management also pointed to CURR, its measure of user retention, hitting an all-time high.
Part of that strength came from a June campaign called Streak Revival, where the company invited lapsed users to earn back lost streaks by completing three lessons.
More than 15 million learners took part, and these reactivated users have shown better retention than typical reengaged users.
Duolingo’s leadership has also been clear about strategy this year, prioritizing user growth over aggressive monetization.
The company raised its adjusted EBITDA margin outlook to 26.5% from 25%, while still targeting 10% to 12% bookings growth and 15% to 18% revenue growth for the full year.
With two respected analysts now pointing to accelerating engagement data heading into Q3, investors seem to be betting that Duolingo stock’s user growth story still has room to run.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
