Duolingo Stock Is Overvalued According to Wall Street Time to.jpeg
Duolingo’s shares rose to meaningless levels for some investors.
Basic business works very well, and the administration is not based on its glories.
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After 43 % jumping by 43 % in 2024, language learning app shares Duolingo(Nasdaq: duol) Another 47 % increased so far in 2025. According to Select Wall Street, stocks rose very simply.
TIPRANKS stock research platform is currently tracking 15 analysts covering Duolingo’s shares. Among these analysts, nothing recommends selling shares, but the average target price is $ 476 per share, slightly lower as duolingo is traded until this writing is written.
In other words, Duolingo shares are trading over what these professionals believe is worth. It is clear that the time has come for sale, right? Well, it’s more complicated than that.
Photo source: duolingo.
Most of the Wall Street price goals take into account only 12 to 18 months. But for those who want to do well in stocks, a long -term view is useful.
Investors who hold shares for five years or more tend to outperform their less patient counterparts. But the philosophy of purchase and celebration cannot be used randomly. On the contrary, the basic work still has to do a good job during the retaining period – the purchase of companies with low basics with a lower loser is still a losing suggestion.
So, this is the first thing to take into account with Duolingo: Is this work ready to do a good job over the next five years?
Duolingo is famous for language learning courses, and this work is completely prosperous. Nearly 47 million people used the platform every day during the first quarter of 2025, and paid 10 million people for a subscription that provides additional privileges, an increase of 40 % over the period of the previous year.
Duolingo’s management attributes its success to a variety of factors, but here are two great types. First, the company makes a lot of A/B tests, as it is constantly making changes based on what works with its users. Second, it also includes many games -like elements in the learning process, making users enthusiastic and participants.
Now, Duolingo takes its linguistic experience and expands its focus on other vertebra, such as mathematics, music, chess and more. There is no limit to what the company can do when it comes to launching courses and programs, which greatly increases the market opportunity.
When it is worth it, companies that can easily expand their market opportunities with long -term products and services. Revenue growth is important to create the value of shareholders, and it is easier to grow up the upper line when the opportunity increases.
Since the beginning of 2022, the average growth of Duolingo has reached more than 40 % of the growth of quarterly revenue, which means that revenues are doubled every two years. This is unusual.
Ycharts data.
Now, Duolingo AI (AI) helps Duolingo to develop new products faster than ever. I launched nearly 150 new linguistic rides in the first quarter alone. For some investors, this is a good thing – the company can expand and grow more quickly.
For others, this technology is a danger to duolingo. Tructured artificial intelligence can also facilitate other companies to provide competing services.
This danger must be recognized, even as Dolingo’s work is prosperous.
I think it is safe to say that, trading nearly 30 times its sales, Duolingo’s shares do not seem to be a deal at the present time. The graph below shows that a large part of this year’s arrow gains is due to the expansion of the multiple evaluation, which must always give potential new investors.
Ycharts data. You
The fact is that as Duolingo advances, its growth is likely to slow. But even if you assume that it maintains a 40 % growth rate, the company will generate $ 4.0 billion in annual revenue by 2029.
With the current market value of 21.9 billion dollars, Duolingo is still trading at 5.5 times the expectation of sales of 2029. This special leaves investors who have the difficult function of the weight of growing business with sound basics and a great opportunity in the market at an increasingly difficult share price.
None of this means that the current Duolingo shareholders should sell their positions. Personally, I wait for the margin at a logical price for me before buying shares. One of those who decide to buy now is to maintain a long -term perspective.
Before buying shares in duolingo, think about this:
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Look at whenNetflixThis list was submitted on December 17, 2004 … if you invest $ 1,000 at the time of our recommendation,You will have 653,702 dollars! Or when NafidiaThis list was presented on April 15, 2005 … if you invest $ 1,000 at the time of our recommendation,You will have 870,207 dollars!
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*The stock consultant dates back from June 9, 2025
Jon Quast has no position in any of the mentioned shares. Motley is a lie recommending Dolingo. Motley Fool has a disclosure policy.
Duolingo stock estimation has been exaggerated, according to LAL Street. Time for sale? It was originally published by Motley Fool
