NASDAQ:DUOL: a strong growth stock preparing for the next leg up?.

Groth investors are looking for stocks showing high revenue and EPS growth. We will have a look here to see if DUOLINGO (NASDAQ:DUOL) is suited for growth investing, while it is forming a base and may be ready to breakout. Investors should of course do their own research, but we spotted DUOLINGO showing up in our growth with base formation screen, so it may be worth spending some more time on it.

Assessing Growth for NASDAQ:DUOL

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NASDAQ:DUOL has earned a 8 for growth:

• The Earnings Per Share has grown by an impressive 277.22% over the past year.
• Looking at the last year, DUOL shows a very strong growth in Revenue. The Revenue has grown by 43.41%.
• Measured over the past years, DUOL shows a very strong growth in Revenue. The Revenue has been growing by 48.65% on average per year.
• DUOL is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 129.76% yearly.
• The Revenue is expected to grow by 30.30% on average over the next years. This is a very strong growth

A Closer Look at Health for NASDAQ:DUOL

ChartMill utilizes a Health Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of liquidity and solvency ratios, both in absolute terms and in comparison to industry peers. NASDAQ:DUOL has earned a 8 out of 10:

• DUOL has an Altman-Z score of 21.58. This indicates that DUOL is financially healthy and has little risk of bankruptcy at the moment.
• DUOL's Altman-Z score of 21.58 is amongst the best of the industry. DUOL outperforms 96.88% of its industry peers.
• There is no outstanding debt for DUOL. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
• DUOL has a Current Ratio of 3.28. This indicates that DUOL is financially healthy and has no problem in meeting its short term obligations.
• DUOL's Current ratio of 3.28 is amongst the best of the industry. DUOL outperforms 81.25% of its industry peers.
• A Quick Ratio of 3.28 indicates that DUOL has no problem at all paying its short term obligations.
• The Quick ratio of DUOL (3.28) is better than 82.81% of its industry peers.

Profitability Examination for NASDAQ:DUOL

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NASDAQ:DUOL was assigned a score of 5 for profitability:

• Looking at the Return On Assets, with a value of 5.81%, DUOL belongs to the top of the industry, outperforming 81.25% of the companies in the same industry.
• Looking at the Return On Equity, with a value of 8.63%, DUOL is in the better half of the industry, outperforming 65.63% of the companies in the same industry.
• The Return On Invested Capital of DUOL (3.92%) is better than 60.94% of its industry peers.
• DUOL has a Profit Margin of 10.44%. This is amongst the best in the industry. DUOL outperforms 81.25% of its industry peers.
• DUOL has a Gross Margin of 73.31%. This is amongst the best in the industry. DUOL outperforms 82.81% of its industry peers.

Looking at the Setup

Besides the Technical Rating, ChartMill assigns a Setup Rating to every stock to determine the degree of consolidation. This rating, ranging from 0 to 10, is updated daily and evaluates various short-term technical indicators. NASDAQ:DUOL currently holds a 7 as its setup rating, suggesting a particular level of consolidation in the stock.

DUOL has an excellent technical rating and also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a resistance zone just above the current price starting at 290.29. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 284.02, a Stop Loss order could be placed below this zone.

More Strong Growth stocks can be found in our Strong Growth screener.

Our latest full fundamental report of DUOL contains the most current fundamental analsysis.

Our latest full technical report of DUOL contains the most current technical analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.