Empowered Funds LLC Buys 17,296 Shares of Duolingo, Inc. $DUOL

Empowered Funds LLC boosted its stake in shares of Duolingo, Inc. (NASDAQ:DUOL) by 917.1% in the 1st quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The institutional investor owned 19,182 shares of the company’s stock after acquiring an additional 17,296 shares during the quarter. Empowered Funds LLC’s holdings in Duolingo were worth $1,891,000 as of its most recent SEC filing.

A number of other hedge funds and other institutional investors also recently made changes to their positions in the stock. Baillie Gifford & Co. grew its holdings in shares of Duolingo by 71.9% in the 4th quarter. Baillie Gifford & Co. now owns 4,861,445 shares of the company’s stock worth $853,184,000 after purchasing an additional 2,033,611 shares during the last quarter. Capital World Investors grew its position in Duolingo by 0.5% during the 4th quarter. Capital World Investors now owns 2,241,378 shares of the company’s stock worth $393,362,000 after acquiring an additional 11,140 shares during the last quarter. State of Michigan Retirement System grew its position in Duolingo by 112.9% during the 1st quarter. State of Michigan Retirement System now owns 1,193,307 shares of the company’s stock worth $117,624,000 after acquiring an additional 632,807 shares during the last quarter. State Street Corp increased its holdings in Duolingo by 0.5% during the 2nd quarter. State Street Corp now owns 1,164,387 shares of the company’s stock valued at $477,422,000 after purchasing an additional 6,109 shares in the last quarter. Finally, Whale Rock Capital Management LLC increased its holdings in Duolingo by 1.0% during the 4th quarter. Whale Rock Capital Management LLC now owns 876,646 shares of the company’s stock valued at $153,851,000 after purchasing an additional 8,477 shares in the last quarter. 91.59% of the stock is owned by institutional investors.

Key Stories Impacting Duolingo

Here are the key news stories impacting Duolingo this week:

• Positive Sentiment: Duolingo reported second-quarter revenue of approximately $298.5 million, up 18.3% year over year and ahead of analysts’ expectations. Adjusted earnings of $0.66 per share also exceeded consensus estimates of roughly $0.60-$0.61. DUOL Q2 Earnings Beat Estimates on Strong User Growth
• Positive Sentiment: User momentum remained strong, with daily active users increasing 23% year over year and paid subscribers also growing. Management said lower artificial-intelligence costs should support its profitability outlook, while it continues targeting 100 million daily active users by 2028.
• Positive Sentiment: Needham reaffirmed its “buy” rating and $145 price target, implying meaningful upside from the current trading level. Needham Reaffirms Duolingo Buy Rating
• Neutral Sentiment: Truist raised its price target from $100 to $120 but maintained a “hold” rating, signaling limited near-term upside in its view.
• Neutral Sentiment: Duolingo may discontinue its Max subscription tier as it prioritizes broader user growth. The change could simplify the product lineup but may affect monetization and average revenue per user.
• Negative Sentiment: Third-quarter revenue guidance of $302 million-$302 million came in below Wall Street’s approximately $303.9 million expectation. The forecast revived concerns that Duolingo’s growth engine is slowing, overshadowing the quarterly beat. Duolingo’s lower-than-expected revenue forecast overshadows quarterly beat
• Negative Sentiment: Although revenue rose, quarterly EPS fell from $0.91 to $0.66 year over year, while net income declined 26%, adding to pressure on the stock.
• Negative Sentiment: Bank of America downgraded Duolingo to “underperform,” reinforcing concerns about valuation and decelerating growth.

Analyst Upgrades and Downgrades

A number of equities analysts have commented on the company. Wells Fargo & Company boosted their price objective on Duolingo from $81.00 to $82.00 and gave the stock an “underweight” rating in a research note on Tuesday, July 7th. Wedbush assumed coverage on Duolingo in a research note on Thursday, July 16th. They issued a “neutral” rating and a $139.00 target price for the company. Needham & Company LLC reaffirmed a “buy” rating and issued a $145.00 price target on shares of Duolingo in a report on Thursday. Bank of America downgraded shares of Duolingo from a “neutral” rating to an “underperform” rating and reduced their price target for the stock from $103.00 to $93.00 in a research report on Tuesday. Finally, Barclays raised their price objective on shares of Duolingo from $110.00 to $115.00 and gave the company an “equal weight” rating in a research report on Thursday. Three investment analysts have rated the stock with a Buy rating, eighteen have issued a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat.com, the stock currently has a consensus rating of “Hold” and an average price target of $148.24.

Duolingo Price Performance

Shares of DUOL opened at $122.58 on Friday. The stock has a market cap of $5.71 billion, a P/E ratio of 14.52, a price-to-earnings-growth ratio of 1.04 and a beta of 0.87. Duolingo, Inc. has a 1 year low of $87.89 and a 1 year high of $468.00. The stock’s 50-day moving average price is $125.37 and its two-hundred day moving average price is $114.99. The company has a current ratio of 2.62, a quick ratio of 2.62 and a debt-to-equity ratio of 0.07.

Duolingo (NASDAQ:DUOL) last announced its quarterly earnings results on Wednesday, August 5th. The company reported $0.66 EPS for the quarter, beating analysts’ consensus estimates of $0.60 by $0.06. Duolingo had a return on equity of 12.23% and a net margin of 35.88%.The company had revenue of $298.45 million during the quarter, compared to analysts’ expectations of $295.58 million. During the same period in the prior year, the business posted $0.91 EPS. Duolingo’s revenue was up 18.3% on a year-over-year basis. On average, equities analysts predict that Duolingo, Inc. will post 2.8 earnings per share for the current year.

Insider Activity

In related news, insider Natalie Glance sold 3,360 shares of the company’s stock in a transaction on Monday, May 18th. The shares were sold at an average price of $113.59, for a total value of $381,662.40. Following the completion of the sale, the insider owned 173,401 shares in the company, valued at $19,696,619.59. This represents a 1.90% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. 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, General Counsel Stephen C. Chen sold 1,977 shares of Duolingo stock in a transaction dated Monday, May 18th. The stock was sold at an average price of $113.61, for a total value of $224,606.97. Following the transaction, the general counsel owned 52,807 shares in the company, valued at approximately $5,999,403.27. This represents a 3.61% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. 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. Insiders sold 9,506 shares of company stock valued at $1,073,864 in the last quarter. Company insiders own 16.62% of the company’s stock.

Duolingo Company Profile

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.