11 Best High Short Interest Stocks With Biggest Upside Potential

Page 7 of 10

4. Duolingo Inc. (NASDAQ:DUOL)

Number of Hedge Fund Holders: 50

Average Upside Potential: 69.86%

Duolingo Inc. (NASDAQ:DUOL) is one of the best high short interest stocks with biggest upside potential. On January 27, DA Davidson lowered its price target for Duolingo to $170 from $205 with a Neutral rating.

While the firm’s proprietary data tracking over 170,000 existing users showed that January experienced its strongest month-over-month increase since tracking began in July, an extrapolation of this strength for the full Q1 implies that DAUs will fall ~4% below current consensus estimates. The adjustment reflects ongoing concerns regarding the company’s ability to maintain high user growth rates amid a trend of deceleration in the language-learning platform’s engagement metrics.

Additionally, on January 13, Morgan Stanley analyst Nathan Feather lowered the firm’s price target on Duolingo to $275 from $300 and kept an Overweight rating on the shares. In a broader note on the North American Internet sector, the firm predicted that 2026 will mirror 2025, with the market favoring companies that show a clear return on invested capital from GenAI or GPU technologies.

Duolingo Inc. (NASDAQ:DUOL) operates as a mobile learning platform in the US, the UK, and internationally. The company offers courses in 40 different languages through its Duolingo app.

Page 7 of 10