Morgan Stanley expects a rally ahead for Duolingo shares. Analyst Nathan Feather opened research coverage of the digital language learning platform with an investment rating of overweight. Feather's $435 price target suggests 29% upside from Tuesday's close and is a new high on Wall Street, according to LSEG. "Duolingo has the rare combination of rapid user growth, strong and expanding margins, and clear Gen AI upside," Feather wrote to clients in a note Wednesday, adding that the company is a "best-in-class consumer internet asset." With his call, Feather joined the majority on Wall Street with buy-equivalent ratings, according to LSEG. Feather said Duolingo can combine mobile gaming and language learning, bringing its total addressable market to $220 billion. The company has only about 0.5% of that share currently, meaning it is "underpenetrated with a long runway for growth." Duolingo still monetizes about five times less than peers. But Feather said the launch of product-first subscriptions can help. In artificial intelligence, Feather said Duolingo is a "rare commodity" in the small- and mid-cap internet space because it is using generative artificial intelligence to improve revenue and profits and has already demonstrated tangible benefits. Shares popped as much as 12.4% in early trading Wednesday on the heels of Feather's initiation of coverage. Earnings are due out on May 1. The stock has now added more than 13% in 2025, extending last year's rally of more than 40%. DUOL 1Y mountain Duolingo, 1-year chart Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange! Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today's dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles and Dan Ives, with a special edition of Pro Talks with Tom Lee. You'll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!
