Jim Cramer’s Latest Thoughts on These 17 Stocks

9. Duolingo, Inc. (NASDAQ:DUOL)

Number of Hedge Fund Holders: 51

Duolingo, Inc. (NASDAQ:DUOL) is one of the stocks Jim Cramer shared his thoughts on. Referring to Cramer’s regard for subscription-based businesses, a caller asked about the company, and he replied:

“You know, Duolingo had like a little bit of a hiccup, and people kind of freaked out. I agree with you. I think Duolingo is the way to learn language. The only thing I am concerned is that if you get those Ray-Bans, you know the Meta Ray-Bans, and they teach you how to speak, you don’t need them, which is why I worry about paying 120 times earnings for them, as those Meta’s, which are very inexpensive, get wider distribution. It may hurt Duolingo’s business.”

Duolingo (NASDAQ:DUOL) operates a mobile learning platform that provides courses in dozens of languages through its app and provides a digital English proficiency assessment exam. On July 8, Morgan Stanley reduced its price target on the company stock to $480 from $515 and reiterated the Overweight rating.

The analyst pointed toward a slowdown in Duolingo’s (NASDAQ:DUOL) daily active user growth, which declined to 39% year-over-year in Q2 from 51% in Q1, after negative social media response in the U.S. to the company’s “AI-First” memo. While the firm sees weaker Q2 trends as a near-term setback, it believes the user response is likely temporary and noted early indications of recovery.