Duolingo's stock has declined 74% over the past year. Shares reached a 52-week low of $112.41. This performance significantly trails the broader tech sector's 12% decline. Investors cite AI disruption as the primary driver, specifically from advanced LLMs and T-Mobile's real-time translation services.
Market analysts remain sharply divided on the company's intrinsic value. Simply Wall St’s DCF analysis suggests the stock is 76.5% undervalued. The analysis sets a fair value of $479.42. Conversely, Zacks Investment Research maintains a Sell rating. Duolingo carries a forward P/E of 26.95x, which exceeds the industry average of 21.58x.
The company reported 39.86% revenue growth. Gross margins currently stand at 71.99%. Management projects future sales growth of 38%. Sentiment has cooled as leadership shifts focus from growth metrics toward teaching quality. Market participants await the next earnings report on February 26.