Critical Comparison: Duolingo (NASDAQ:DUOL) vs. Nexalin Technology (NASDAQ:NXL)

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

Profitability

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

	Net Margins	Return on Equity	Return on Assets
Duolingo	40.03%	14.02%	9.15%
Nexalin Technology	-5,527.39%	-207.46%	-184.51%

Risk and Volatility

Duolingo has a beta of 0.87, indicating that its share price is 13% less volatile than the S&P 500. Comparatively, Nexalin Technology has a beta of 3.94, indicating that its share price is 294% more volatile than the S&P 500.

Insider and Institutional Ownership

91.6% of Duolingo shares are held by institutional investors. Comparatively, 0.7% of Nexalin Technology shares are held by institutional investors. 18.3% of Duolingo shares are held by insiders. Comparatively, 25.3% of Nexalin Technology shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent recommendations for Duolingo and Nexalin Technology, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Duolingo	1	11	12	0	2.46
Nexalin Technology	1	0	1	0	2.00

Duolingo currently has a consensus target price of $311.00, suggesting a potential upside of 69.44%. Nexalin Technology has a consensus target price of $5.00, suggesting a potential upside of 576.59%. Given Nexalin Technology’s higher possible upside, analysts plainly believe Nexalin Technology is more favorable than Duolingo.

Valuation & Earnings

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

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Duolingo	$748.02 million	11.34	$88.57 million	$7.89	23.26
Nexalin Technology	$170,000.00	81.07	-$7.61 million	($0.66)	-1.12

Duolingo has higher revenue and earnings than Nexalin Technology. Nexalin Technology 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 Nexalin Technology on 10 of the 14 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 Nexalin Technology

Nexalin Technology, Inc., a medical device company, designs and develops neurostimulation products for the treatment of mental health in the United States and China. The company designs and develops Generation 2 and Generation 3, that is in clinical trials for the treatment of substance abuse issues related to opiate, cocaine, alcohol abuse, alzheimer's disease, and dementia. It also licenses and sells Nexalin Device, a non-invasive and undetectable to the human body that can provide relief to its afflicted with mental health issues. The company is based in Houston, Texas.