Duolingo’s latest earnings report was released on May 8. With this information, we receive their EPS (earning per share) which is a metric of how much money a company makes for each share of its stock. This is a commonly used metric for estimating corporate value. A higher EPS indicates greater value while lower means less value. This is because investors will pay more for the company’s shares if the company has higher profits relative to its share price making it a good investment.
Going off Duolingo’s last quarter, Duolingo’s revenue went up by 1.8%, 151 million dollars. That is considered a good growth margin compared to other companies. This year, financial analysts are estimating Duolingo to grow at almost the same rate. So why did Duolingo stock go down by 20%? This is because Duolingo has released their user-growth rate slowing down. This is a huge red-flag for investors resulting in the dip in Duolingo. Stay away.
Disney’s earnings were also released recently on May 7. Going off Disney’s earnings released on May 7th, Disney’s revenue missed the estimates of analysts. 22.08 billion vs 22.14 billion (a small miss) against the estimated value. A company’s performance can be represented by its investment value. Over the annual revenue growth of 8.3% Disney’s business is weak in terms of investment values.
Over Disney’s quarter results, Disney came slightly ahead of expectations this quarter; falling short on Wall Street’s guesses. As of Now Disney is 6.73% down ($103) this month leading to the question of investing in this opportunity on this low. Short answer being not worth it; this is because when looking over a company and their assets Disney has shown to not be the best option.
Regarding its slow growth progression, Disney’s EPS has been declining as years pass by. Not only that, Disney’s ROIC (Return on Invested Capital) shows that it is struggling to profit altogether, making investors hesitate. In conclusion, Disney is not a terrible company, but there are better opportunities. As always, invest smartly.
