Duolingo Inc. (DUOL) PT Raised to $410 at UBS

UBS analyst Chris Kuntarich raised the price target on Duolingo Inc. (NASDAQ: DUOL) to $410.00 (from $408.00) while maintaining a Buy rating.

The analyst said, "We look for DUOL to use the 4Q print to 1) moderate FY25 DAU growth expectations, 2) provide conservative initial FY25 bookings/adj. EBITDA margin guidance and 3) share more color on Max adoption. We now model FY25 avg DAUs at +37% YoY (St 40%) which reflects a decel to 34% YoY growth by 4Q25 and +13.5M YoY DAU net adds (4Q24 +13M) - still healthy, but capturing the 8ppt decel in 4Q Sensor Tower DAU YoY growth. Regarding margins, St GM ests for FY25 reflect a modest Max adoption ramp in FY25 (50bps of GM deleverage in FY25 vs UBSe 170bps), but we expect more prolonged seq. declines given how early Max is in its product life cycle. Net-net, we maintain our Buy rating with investors well aware of DUOL's conservative guidance track record, and barring a guide below sell-side FY25 ests, more constructive Max adoption data points could push DUOL shares higher."

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