Nel ASA: Market Cheers Cheaper Electrolyser, Then Dumps Stock as Order Pipeline Thins

Nel ASA’s new pressurised alkaline electrolyser – eight years in development – promises to slash the capital cost of green hydrogen production by roughly half. The system, built at the company’s Herøya facility, targets turnkey costs of under $1,450 per kilowatt for large-scale projects, a stark contrast to the industry norm of around $3,000. The technology delivers hydrogen at high pressure and extreme purity, eliminating downstream compression steps and cutting energy requirements. Yet the market’s reaction has been anything but celebratory.

After a 30-day rally that lifted the stock nearly 46% – and a year-to-date advance of roughly 44-45% – Nel’s shares have given back some of those gains. On a weekly basis, the stock is down 11.6%, trading at €0.28 on Tuesday with a fractional 1.09% gain for the session. The move looks like a textbook “sell the news” event: investors had hoped the product launch would be accompanied by concrete large-scale orders. Those have not materialised.

The order book tells the story. In the first quarter, Nel booked just 85 million Norwegian kroner in new orders, a 73% plunge year-on-year. Revenue slipped to 148.1 million kroner, slightly below the prior-year quarter. The EBITDA loss remained stubbornly high at 100 million kroner, translating into a loss per share of NOK 0.08. The operating loss was in the same neighbourhood. The company’s core business – industrial hydrogen production via electrolysers – is still bleeding red ink even as the technology advances.

Green hydrogen’s cost disadvantage remains a structural headwind. It can cost up to five times as much as grey hydrogen, making efficiency gains in compression and scaling critical. Nel’s new platform is a direct attempt to close that gap, but the market wants to see commercial traction, not just engineering milestones.

Should investors sell immediately? Or is it worth buying Nel ASA?

The recent pullback has not undone the technical improvement. The stock is still well above both its 50-day moving average (by about 32%) and its 200-day moving average (by about 38%). The relative strength index sits at 37, suggesting no euphoria, while annualised 30-day volatility is near 90%. A key support zone lies between €0.23 and €0.25; if that holds, chartists see the €0.40 level as the next upside target. The stock hit a 52-week high of €0.32 in early May and has bounced sharply from its low of €0.18.

Analysts remain cautious. RBC Capital Markets rates the shares “Sector Perform” with a target of 3 Norwegian kroner. Berenberg calls it a “Hold” with a target of 2.30 kroner. Neither firm is betting on a rapid turnaround.

The competitive landscape is heating up. The European Commission is disbursing more than €1 billion from its Innovation Fund to support 1.1 GW of electrolyser capacity, but US rival Plug Power recently posted 22% revenue growth and sharply improved margins. Nel will need to show that its new platform can convert into market share quickly.

Nel ASA at a turning point? This analysis reveals what investors need to know now.

Management will get its next chance to prove the narrative on July 15, when second-quarter results are released. Until then, Nel remains a stock caught between technical recovery and fundamental strain – a cheaper electrolyser is a promising tool, but a thin order book is a heavy anchor.

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Nel ASA Stock: New Analysis - 12 May

Fresh Nel ASA information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.

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