Duolingo (NASDAQ:DUOL) shares rose 3.8% in pre-market trading after Evercore ISI analyst Mark Mahaney upgraded the stock to “Outperform” from “In Line” and raised the firm’s price target to $210.
Evercore based its revised target on a valuation of 20 times estimated 2028 EBITDA. The firm also increased its earnings forecasts, with its 2027 and 2028 EPS estimates now 10% and 25% above Wall Street consensus, respectively.
The $210 price target implies more than 40% upside from the recent trading level cited in the supplied information. Analyst price targets represent estimates and do not indicate future share-price performance.
Analyst actions follow second-quarter results
Evercore’s upgrade follows several other analyst actions during August. DA Davidson upgraded Duolingo to “Buy”, while JPMorgan and Wedbush increased their respective price targets.
The changes came after Duolingo reported second-quarter revenue of $298.5 million, exceeding the consensus estimate. Daily active users increased 23% year over year to 58.7 million.
The company also announced a $400 million share repurchase programme alongside its quarterly results.
Duolingo gains as U.S. equity futures decline
Duolingo’s pre-market increase came as broader U.S. equity futures traded lower. S&P 500 futures declined approximately 0.6%, while Nasdaq-100 futures were down close to 1%.
Investors were assessing renewed military tensions between the United States and Iran, higher crude oil prices and changing expectations for Federal Reserve monetary policy.
Markets were also awaiting the JOLTS job openings report later in the session, ahead of Friday’s monthly U.S. employment data.
Duolingo’s 3.8% pre-market advance followed Evercore’s rating upgrade and increased earnings estimates, with the brokerage focusing on the company’s product development and monetisation prospects.
Duolingo stock price
