PITTSBURGH—Hacker Severin, Chief Technology Officer and co-founder of Duolingo Inc. (NASDAQ:DUOL), recently sold shares in the company totaling approximately $14.1 million, according to a filing with the Securities and Exchange Commission. The language-learning platform, currently valued at $14.9 billion, has demonstrated impressive financial performance with 42% revenue growth over the last twelve months.
The transactions, which occurred on December 12, involved the sale of Class A Common Stock at prices ranging from $336.91 to $344.72 per share. Following these sales, Severin retains ownership of 72 shares directly. According to InvestingPro analysis, the stock appears to be trading above its Fair Value, despite maintaining impressive gross profit margins of 73%.
These sales were conducted under Severin's Rule 10b5-1 trading plan, which was adopted on September 11, 2024. The plan allows insiders to set up a predetermined schedule for selling stocks to avoid any potential insider trading violations.
Severin's role as both a director and officer at Duolingo underscores the significance of these transactions for investors monitoring insider activity at the language-learning platform.
In other recent news, Duolingo Inc. has been making significant strides in the edtech sector. The company reported robust growth in its third quarter 2024 earnings call, with a 54% year-over-year increase in daily active users. The company also raised its full-year guidance, anticipating a 36% increase in bookings and a 40% boost in revenue. The firm's new AI-powered video call feature, part of the Duolingo Max subscription tier, has been rolled out to about half of its users, with plans for further expansion.
In other developments, BofA Securities recently downgraded Duolingo from "Buy" to "Neutral" due to less upside potential. Despite acknowledging Duolingo's high-quality status and consistent growth trajectory, BofA Securities cited the company's current market valuation and potential lower estimate revisions as reasons for the downgrade. The firm, however, increased Duolingo's price target to $375 from the previous $375, based on the projected 2026 Enterprise Value/Sales.
These developments emphasize Duolingo's ongoing efforts to scale in international markets and expand its high Average Revenue Per User tiers. The firm's strategies, including attracting users virally and increasing subscriber numbers relative to total users, are seen as promising long-term growth opportunities. Despite the recent downgrade, Duolingo's commitment to innovation and user engagement continues to position it well in the global language learning market.
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