Analyzing Klaviyo (NYSE:KVYO) & Duolingo (NASDAQ:DUOL)

Duolingo (NASDAQ:DUOL) and Klaviyo (NYSE:KVYO) are both business services companies, but which is the superior investment? We will contrast the two businesses based on the strength of their risk, institutional ownership, analyst recommendations, earnings, profitability, valuation and dividends.

Insider and Institutional Ownership

91.6% of Duolingo shares are owned by institutional investors. Comparatively, 45.4% of Klaviyo shares are owned by institutional investors. 18.3% of Duolingo shares are owned by company insiders. Comparatively, 53.2% of Klaviyo shares are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility and Risk

Duolingo has a beta of 0.79, indicating that its stock price is 21% less volatile than the S&P 500. Comparatively, Klaviyo has a beta of 1.13, indicating that its stock price is 13% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Duolingo and Klaviyo, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Duolingo	0	5	6	1	2.67
Klaviyo	0	3	15	0	2.83

Duolingo currently has a consensus target price of $325.44, suggesting a potential downside of 0.44%. Klaviyo has a consensus target price of $39.00, suggesting a potential upside of 16.94%. Given Klaviyo’s stronger consensus rating and higher probable upside, analysts plainly believe Klaviyo is more favorable than Duolingo.

Profitability

This table compares Duolingo and Klaviyo’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Duolingo	12.59%	12.20%	8.23%
Klaviyo	-5.23%	0.87%	0.74%

Valuation and Earnings

This table compares Duolingo and Klaviyo”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Duolingo	$531.11 million	26.80	$16.07 million	$1.83	178.63
Klaviyo	$698.10 million	12.74	-$308.23 million	($0.18)	-185.27

Duolingo has higher earnings, but lower revenue than Klaviyo. Klaviyo is trading at a lower price-to-earnings ratio than Duolingo, indicating that it is currently the more affordable of the two stocks.

Summary

Duolingo beats Klaviyo on 9 of the 15 factors compared between the two stocks.

About Duolingo

Duolingo, Inc. operates as a mobile learning platform in the United States, the United Kingdom, and internationally. The company offers courses in 40 different languages, including Spanish, English, French, German, Italian, Portuguese, Japanese, and Chinese through its Duolingo app. It also provides a digital English language proficiency assessment exam. Duolingo, Inc. was incorporated in 2011 and is headquartered in Pittsburgh, Pennsylvania.

About Klaviyo

Klaviyo, Inc., a technology company, provides a software-as-a-service platform in the United States, other Americas, the Asia-Pacific, Europe, the Middle East, and Africa. The company offers Klaviyo, a cloud-native platform for data store, segmentation engine, campaigns and flows, and messaging infrastructure. It also provides email to send personalized marketing emails, including drag-and-drop email templates to edit and customize pre-built templates; email campaigns and automations with smart send time features, generative artificial intelligence for subject line creation, A/B testing tools, and consumer list segmentation; short message services to send targeted marketing text messages to consumers, as well as built-in contact cards to ensure that texts does not appear as random numbers; and push, a personalized push notification to engage with consumer. In addition, the company offers other applications, such as reviews, which collect product reviews; and customer data platform that allows to manage, deploy, transform, and sync data. It serves its products to entrepreneurs, small and medium-sized businesses to mid-market businesses, and enterprises. The was incorporated in 2012 and is headquartered in Boston, Massachusetts.