DA Davidson Lowers Duolingo (DUOL) PT to $170, Maintains Neutral Rating

Duolingo Inc. (NASDAQ:DUOL) is one of the best high short interest stocks with biggest upside potential. On January 27, DA Davidson lowered its price target for Duolingo to $170 from $205 with a Neutral rating.

While the firm’s proprietary data tracking over 170,000 existing users showed that January experienced its strongest month-over-month increase since tracking began in July, an extrapolation of this strength for the full Q1 implies that DAUs will fall ~4% below current consensus estimates. The adjustment reflects ongoing concerns regarding the company’s ability to maintain high user growth rates amid a trend of deceleration in the language-learning platform’s engagement metrics.

Additionally, on January 13, Morgan Stanley analyst Nathan Feather lowered the firm’s price target on Duolingo to $275 from $300 and kept an Overweight rating on the shares. In a broader note on the North American Internet sector, the firm predicted that 2026 will mirror 2025, with the market favoring companies that show a clear return on invested capital from GenAI or GPU technologies.

Duolingo Inc. (NASDAQ:DUOL) operates as a mobile learning platform in the US, the UK, and internationally. The company offers courses in 40 different languages through its Duolingo app.

While we acknowledge the potential of DUOL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.