Nel ASA: A Hydrogen Story of Contrasts as Orders Surge and Costs Bite
Published on 08/06/2026 at 08:41 | Redaktion boerse-global.de
The Norwegian electrolyser maker Nel ASA is presenting investors with a study in contradictions. Its order intake has exploded by 224 percent, yet its revenue is shrinking, its cash pile is eroding, and a key Wall Street bank has just trimmed its price target. The question hanging over the stock is whether the pipeline of future work can outrun the burn rate of the present.
The Analyst View Turns Cautious
JPMorgan's Patrick Jones lowered his price target on Nel ASA to NOK 1.80 on Wednesday, though the bank offered no immediate rationale for the cut. The move lands as the shares trade at roughly EUR 0.1964, down about 0.91 percent on the day. That puts the stock nearly 46 percent below its 52-week high of EUR 0.3655, reached on May 25, while still holding a 13.46 percent cushion above the February 26 low of EUR 0.1731.
A quantitative rating system has simultaneously nudged its stance from "Sell" to "Hold/Accumulate," though the mechanical nature of that adjustment limits its significance relative to the bank's fundamental caution. The relative strength index sits at 40.6, pointing to a neutral-to-soft tone without flashing any immediate reversal signals. Year-to-date, however, the shares remain up 4.77 percent, suggesting the recent softness is more a pullback from earlier highs than a sustained downtrend.
A Quarter of Sharp Contradictions
The second-quarter figures, released on July 15, capture the company's predicament in stark relief. Revenue from customer contracts fell 12 percent year-on-year to NOK 153 million, down from NOK 174 million in the same period of 2025. EBITDA swung to a loss of NOK 155 million, burdened by a NOK 70 million one-off charge tied to a legal settlement with Iwatani Corporation of America, concluded in early June.
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Against that softness, the order book tells a far more encouraging story. Incoming orders jumped 224 percent to NOK 230 million in the quarter, driven predominantly by demand for PEM electrolysers. The total backlog expanded to NOK 1.213 billion, a 9 percent improvement on the prior quarter. The gap between a shrinking revenue line and a swelling pipeline suggests demand for Nel's hydrogen technology remains intact — the company simply cannot convert orders into recognised sales quickly enough.
The balance sheet reveals the strain of that lag. Cash reserves dwindled to NOK 1.328 billion by the end of the quarter, down from NOK 1.928 billion at June 30, 2025. The drawdown underscores a business that continues to consume more capital than it generates while it waits for the order momentum to translate into actual revenue.
Cost Discipline and a New Product Push
Management has not been idle on the cost front. Following the spin-off of Cavendish Hydrogen, Nel has slimmed its workforce from 430 to 313 employees, a reduction confirmed during a July 30 conference call. The company is also advancing its "PA-Series" platform for pressurised alkaline electrolysers, unveiled in May, with a target of delivering turnkey costs below USD 1,450 per kilowatt for 25-megawatt installations — roughly half the industry standard of around USD 3,000 per kilowatt.
Leadership uncertainty adds another layer of complexity. CEO Håkon Volldal announced his resignation in June to pursue another opportunity, remaining in place through a six-month notice period while the board searches for a successor. Investors face months of continuity at the operational helm, but also prolonged ambiguity about strategic direction under new management.
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Brussels Beckons as a Potential Catalyst
Near-term attention is shifting to the EU capital. The European Commission is expected to announce results from its "HORIZON-JU-CLEANH2-2026" funding programme in early August, for which 170 projects in green hydrogen production and storage have been submitted. Nel has already secured a commitment of up to EUR 135 million from the EU Innovation Fund, and a favourable outcome could provide short-term momentum for the shares.
The company has also said it will stop formally collecting and publishing analyst estimates, citing a decline in the number of participating analysts. The next scheduled catalyst is the third-quarter interim report on October 21, when investors will see whether the PEM order surge is finally translating into revenue growth and whether the leadership transition has begun to take shape. Until then, the stock remains caught between operational bright spots and a cautious analyst community.
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