Duolingo stock price target lowered to $450 by UBS on slower user growth

Investing.com - UBS has lowered its price target on Duolingo Inc. (NASDAQ:DUOL) to $450 from $500 while maintaining a Buy rating on Monday. The language learning platform, currently trading at $321.90 with a market cap of $14.78 billion, maintains a GREAT financial health score according to InvestingPro analysis.

The firm trimmed its third and fourth quarter daily active user (DAU) growth forecasts to 33% and 27% year-over-year, respectively, below consensus expectations of 36% and 34%. UBS also reduced its fiscal year 2026 DAU growth projection to 25% year-over-year, compared to Street estimates of 29%. Despite these adjustments, Duolingo maintains impressive gross margins of 72% and has demonstrated strong revenue growth of 40% over the last twelve months.

The revised outlook includes cuts to UBS’s fiscal year 2026 revenue and EBITDA forecasts by 0.9% and 4.3%, respectively, with some offset expected from additional advertising revenue following the launch of Duolingo’s new ad platform.

Despite these adjustments, UBS noted some positive signals, including stabilization in September’s daily active user metrics and evidence that Duolingo’s social media presence appears to have bottomed in August, which should support increased paid user acquisition activity in the US.

For fourth quarter 2025, UBS expects Duolingo to guide bookings and revenue toward the high end of its range at $350 million and $277 million, compared to UBS estimates of $345 million and $274 million, and Street consensus of $344 million and $275 million. With the company’s next earnings report due on November 5, 2025, investors can access comprehensive analysis and 12+ additional insights through InvestingPro’s detailed research reports.

In other recent news, Duolingo Inc. has seen a series of analyst evaluations regarding its stock performance. Citizens has maintained its Market Outperform rating with a price target of $500, citing social engagement as a key indicator for future user activity, although current data does not yet show an increase in daily active users. KeyBanc also reiterated its Overweight rating, setting a price target of $460, despite noting a deceleration in user growth, now projecting a 33% year-over-year increase. DA Davidson has kept its Neutral rating and $300 price target, observing improvements in active users during September compared to August.

Meanwhile, Citizens JMP has reiterated its Market Outperform rating on Grindr, with a price target of $23, highlighting the potential benefits of adopting web-based checkouts for subscription sign-ups. Additionally, a Citizens JMP analyst has reaffirmed a Market Outperform rating on Life360, maintaining a positive outlook with a $95 price target. These recent developments provide investors with insights into the current evaluations and expectations from key analysts.

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