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DUOLINGO (DUOL) Stock Fundamental Analysis

NASDAQ:DUOL - Nasdaq - US26603R1068 - Common Stock - Currency: USD

385.35  -36.43 (-8.64%)

After market: 388 +2.65 (+0.69%)

Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to DUOL. DUOL was compared to 71 industry peers in the Diversified Consumer Services industry. While DUOL has a great health rating, its profitability is only average at the moment. DUOL shows excellent growth, but is valued quite expensive already. With these ratings, DUOL could be worth investigating further for growth investing!.


Dividend Valuation Growth Profitability Health

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5

1. Profitability

1.1 Basic Checks

DUOL had positive earnings in the past year.
In the past year DUOL had a positive cash flow from operations.
In the past 5 years DUOL reported 4 times negative net income.
Each year in the past 5 years DUOL had a positive operating cash flow.
DUOL Yearly Net Income VS EBIT VS OCF VS FCFDUOL Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2019 2020 2021 2022 2023 0 50M -50M 100M 150M

1.2 Ratios

Looking at the Return On Assets, with a value of 7.12%, DUOL belongs to the top of the industry, outperforming 81.25% of the companies in the same industry.
The Return On Equity of DUOL (10.55%) is better than 67.19% of its industry peers.
With a decent Return On Invested Capital value of 5.59%, DUOL is doing good in the industry, outperforming 67.19% of the companies in the same industry.
Industry RankSector Rank
ROA 7.12%
ROE 10.55%
ROIC 5.59%
ROA(3y)-5.13%
ROA(5y)-7.73%
ROE(3y)-6.75%
ROE(5y)-12.22%
ROIC(3y)N/A
ROIC(5y)N/A
DUOL Yearly ROA, ROE, ROICDUOL Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2019 2020 2021 2022 2023 0 -5 -10 -15 -20 -25

1.3 Margins

Looking at the Profit Margin, with a value of 12.59%, DUOL belongs to the top of the industry, outperforming 84.38% of the companies in the same industry.
DUOL's Operating Margin of 7.87% is in line compared to the rest of the industry. DUOL outperforms 59.38% of its industry peers.
DUOL has a better Gross Margin (73.13%) than 85.94% of its industry peers.
In the last couple of years the Gross Margin of DUOL has remained more or less at the same level.
Industry RankSector Rank
OM 7.87%
PM (TTM) 12.59%
GM 73.13%
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.78%
GM growth 5YN/A
DUOL Yearly Profit, Operating, Gross MarginsDUOL Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2019 2020 2021 2022 2023 0 20 -20 40 60

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8

2. Health

2.1 Basic Checks

DUOL has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
DUOL has more shares outstanding than it did 1 year ago.
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 Yearly Shares OutstandingDUOL Yearly Shares OutstandingYearly Shares Outstanding 2019 2020 2021 2022 2023 10M 20M 30M 40M
DUOL Yearly Total Debt VS Total AssetsDUOL Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2019 2020 2021 2022 2023 200M 400M 600M 800M

2.2 Solvency

An Altman-Z score of 29.28 indicates that DUOL is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 29.28, DUOL belongs to the best of the industry, outperforming 98.44% of the companies in the same industry.
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.
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Altman-Z 29.28
ROIC/WACC0.53
WACC10.63%
DUOL Yearly LT Debt VS Equity VS FCFDUOL Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2019 2020 2021 2022 2023 0 200M 400M 600M

2.3 Liquidity

A Current Ratio of 3.09 indicates that DUOL has no problem at all paying its short term obligations.
DUOL's Current ratio of 3.09 is amongst the best of the industry. DUOL outperforms 81.25% of its industry peers.
DUOL has a Quick Ratio of 3.09. This indicates that DUOL is financially healthy and has no problem in meeting its short term obligations.
DUOL's Quick ratio of 3.09 is amongst the best of the industry. DUOL outperforms 82.81% of its industry peers.
Industry RankSector Rank
Current Ratio 3.09
Quick Ratio 3.09
DUOL Yearly Current Assets VS Current LiabilitesDUOL Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2019 2020 2021 2022 2023 200M 400M 600M 800M

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8

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 777.78% over the past year.
The Revenue has grown by 42.48% in the past year. This is a very strong growth!
The Revenue has been growing by 48.65% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)777.78%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%716.67%
Revenue 1Y (TTM)42.48%
Revenue growth 3Y48.65%
Revenue growth 5YN/A
Sales Q2Q%39.94%

3.2 Future

The Earnings Per Share is expected to grow by 134.25% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 26.78% on average over the next years. This is a very strong growth
EPS Next Y509.3%
EPS Next 2Y197.32%
EPS Next 3Y134.25%
EPS Next 5YN/A
Revenue Next Year40.81%
Revenue Next 2Y35.22%
Revenue Next 3Y31.67%
Revenue Next 5Y26.78%

3.3 Evolution

Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
DUOL Yearly Revenue VS EstimatesDUOL Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 500M 1B 1.5B 2B
DUOL Yearly EPS VS EstimatesDUOL Yearly EPS VS EstimatesYearly EPS VS Estimates 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 0 2 -2 4

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3

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 210.57, DUOL can be considered very expensive at the moment.
DUOL's Price/Earnings ratio is in line with the industry average.
The average S&P500 Price/Earnings ratio is at 29.63. DUOL is valued rather expensively when compared to this.
With a Price/Forward Earnings ratio of 128.21, DUOL can be considered very expensive at the moment.
Compared to the rest of the industry, the Price/Forward Earnings ratio of DUOL is on the same level as its industry peers.
DUOL is valuated expensively when we compare the Price/Forward Earnings ratio to 22.68, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 210.57
Fwd PE 128.21
DUOL Price Earnings VS Forward Price EarningsDUOL Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 50 100 150 200

4.2 Price Multiples

Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of DUOL is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of DUOL is on the same level as its industry peers.
Industry RankSector Rank
P/FCF 74.17
EV/EBITDA 278.14
DUOL Per share dataDUOL EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
DUOL's earnings are expected to grow with 134.25% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.41
PEG (5Y)N/A
EPS Next 2Y197.32%
EPS Next 3Y134.25%

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0

5. Dividend

5.1 Amount

No dividends for DUOL!.
Industry RankSector Rank
Dividend Yield N/A

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DUOLINGO

NASDAQ:DUOL (2/21/2025, 8:14:39 PM)

After market: 388 +2.65 (+0.69%)

385.35

-36.43 (-8.64%)

Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryDiversified Consumer Services
Earnings (Last)11-06 2024-11-06/amc
Earnings (Next)02-27 2025-02-27/amc
Inst Owners93.89%
Inst Owner Change-1.22%
Ins Owners0.88%
Ins Owner Change-14.52%
Market Cap16.95B
Analysts74.81
Price Target356.14 (-7.58%)
Short Float %4.01%
Short Ratio2.47
Dividend
Industry RankSector Rank
Dividend Yield N/A
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)45.94%
Min EPS beat(2)35.64%
Max EPS beat(2)56.25%
EPS beat(4)4
Avg EPS beat(4)61.33%
Min EPS beat(4)35.64%
Max EPS beat(4)105.07%
EPS beat(8)8
Avg EPS beat(8)81.31%
EPS beat(12)12
Avg EPS beat(12)64.7%
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)0
Avg Revenue beat(2)-0.7%
Min Revenue beat(2)-1.27%
Max Revenue beat(2)-0.12%
Revenue beat(4)0
Avg Revenue beat(4)-0.57%
Min Revenue beat(4)-1.27%
Max Revenue beat(4)-0.04%
Revenue beat(8)4
Avg Revenue beat(8)0.32%
Revenue beat(12)7
Avg Revenue beat(12)0.76%
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)1.27%
PT rev (3m)29.82%
EPS NQ rev (1m)2.76%
EPS NQ rev (3m)2.4%
EPS NY rev (1m)0.11%
EPS NY rev (3m)1.21%
Revenue NQ rev (1m)0.21%
Revenue NQ rev (3m)0.46%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)0.23%
Valuation
Industry RankSector Rank
PE 210.57
Fwd PE 128.21
P/S 24.58
P/FCF 74.17
P/OCF 67.42
P/B 20.61
P/tB 21.45
EV/EBITDA 278.14
EPS(TTM)1.83
EY0.47%
EPS(NY)3.01
Fwd EY0.78%
FCF(TTM)5.2
FCFY1.35%
OCF(TTM)5.72
OCFY1.48%
SpS15.68
BVpS18.7
TBVpS17.96
PEG (NY)0.41
PEG (5Y)N/A
Profitability
Industry RankSector Rank
ROA 7.12%
ROE 10.55%
ROCE 6.18%
ROIC 5.59%
ROICexc N/A
ROICexgc N/A
OM 7.87%
PM (TTM) 12.59%
GM 73.13%
FCFM 33.14%
ROA(3y)-5.13%
ROA(5y)-7.73%
ROE(3y)-6.75%
ROE(5y)-12.22%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y0.78%
GM growth 5YN/A
F-Score6
Asset Turnover0.57
Health
Industry RankSector Rank
Debt/Equity 0
Debt/FCF 0
Debt/EBITDA 0
Cap/Depr 249.06%
Cap/Sales 3.32%
Interest Coverage 250
Cash Conversion 396.3%
Profit Quality 263.3%
Current Ratio 3.09
Quick Ratio 3.09
Altman-Z 29.28
F-Score6
WACC10.63%
ROIC/WACC0.53
Cap/Depr(3y)209.38%
Cap/Depr(5y)245.12%
Cap/Sales(3y)2.6%
Cap/Sales(5y)3.54%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)777.78%
EPS 3YN/A
EPS 5YN/A
EPS Q2Q%716.67%
EPS Next Y509.3%
EPS Next 2Y197.32%
EPS Next 3Y134.25%
EPS Next 5YN/A
Revenue 1Y (TTM)42.48%
Revenue growth 3Y48.65%
Revenue growth 5YN/A
Sales Q2Q%39.94%
Revenue Next Year40.81%
Revenue Next 2Y35.22%
Revenue Next 3Y31.67%
Revenue Next 5Y26.78%
EBIT growth 1Y250.68%
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next Year4161.24%
EBIT Next 3Y332.95%
EBIT Next 5Y166.09%
FCF growth 1Y609.62%
FCF growth 3Y116.97%
FCF growth 5YN/A
OCF growth 1Y491.49%
OCF growth 3Y105.47%
OCF growth 5YN/A