Duolingo stock has been quietly climbing higher all summer
Duolingo Inc (NASDAQ:DUOL) stock is bucking the broad market selloff today, up 6.4% to trade at $156.88, after an upgrade to "outperform" from "in-line." The analyst in coverage also doubled its price target to $210, citing strong survey data projecting a "Netflix-like" growth setup.
It's the stock's second upgrade within a two week span. DUOL is pacing for its highest close since Jan. 22, but remains below its year-to-date breakeven level. The shares are also fresh off their fifth-straight weekly and monthly win, a slow climb from the April 9 52-week low of $87.89.
More analyst revisions could keep the wind at the equity's back. Of the 23 brokerages covering Duolingo, 18 maintain "hold" or worse ratings, while the consensus 12-month price target of $131.96 is a 18% premium from its current perch.
A short squeeze is also in play. Short interest is down 5.4% in the most recent reporting period, yet the 7.09 million shares sold short account for nearly 18% of DUOL's total available float. At the stock's average pace of trading, it would take shorts more than five trading days to buy back their bearish bets.