DA Davidson went against Wall Street and recommended buying Duolingo stock. The stock soared.

The research firm DA Davidson went against the Wall Street consensus and upgraded its rating on shares of the language-learning platform Duolingo from “neutral” to “buy.” Meanwhile, most other analysts continue to maintain a more cautious recommendation—to hold Duolingo shares in their portfolios. DA Davidson believes that growth in daily active users, “changes in marketing, and the company’s ongoing efforts to improve its core monetization model” could support Duolingo’s stock, according to CNBC.

Against this backdrop, the company's stock soared by more than 7% on August 18. However, year-to-date, it is still down 20%.

Analysts at DA Davidson upgraded Duolingo’s stock rating from Neutral (equivalent to a “hold” recommendation) to Buy and raised the price target for the language learning platform’s shares from $130 to $160 per share. This target implies approximately 23% upside potential for Duolingo shares relative to the closing price on August 17.

“Investors are underestimating the [company’s] work on the product, changes in marketing, and ongoing efforts to improve its key monetization model,” says DA Davidson analyst Wyatt Swanson, as quoted by CNBC. In this regard, the analyst is confident that “the company still has significant growth potential in the coming years.”

According to him, June 2026 marked a “turning point in terms of daily active users” for Duolingo: “We’re figuring out how daily active users (DAU) can continue to accelerate and how growth in paid subscribers (bookings) can align with DAU growth rates,” Swanson wrote. He attributed the platform’s improved metrics in part to Duolingo’s campaign to bring back the “learning streak” feature. In June, the company gave users who had previously studied a language for more than 30 consecutive days but stopped due to missed sessions the opportunity to resume their learning series, Fast Company notes. However, DAU growth continued through July and August, Swanson noted.

In addition, according to its data, Duolingo has managed to improve user retention: users are staying on the platform longer than before. According to the analyst, this indicates that Duolingo’s product has improved. The longer the audience stays on the platform, the more opportunities Duolingo has to monetize its content, CNBC notes.

Duolingo’s stock has experienced a sharp reversal: between 2023 and 2024, the company’s shares rose by more than 350%, but between 2025 and 2026, they fell by about 60%, according to CNBC. Since the beginning of 2026, the language-learning platform’s stock has been down more than 20%: the company’s business has been overshadowed by a slowdown in the growth of paid subscribers, as well as concerns about the potential impact of AI on the Duolingo product.

DA Davidson’s positive outlook stands in stark contrast to the sentiment of most analysts. According to MarketWatch, only four analysts recommend buying Duolingo stock, 20 advise investors to hold the company’s shares in their portfolios, and three recommend selling. The average price target is $125 per share, which is 4% below the closing price on August 17.

This article was AI-translated and verified by a human editor