ITM Power: The Market Has Left Analysts in the Dust

ITM Power's rally to 150p defies analyst targets as profit-taking begins, despite record revenue, government backing, and narrowing losses.

The disconnect between what ITM Power is worth and what investors are willing to pay for it has rarely been wider. After a breathtaking rally from 30 pence to above 150 pence in under a year, the hydrogen specialist now trades at roughly double the average analyst price target — and the selling has begun.

Profit-Taking Hits After a 400% Run

Monday brought a sharp reality check. Shares slid to 143.30 pence as 13.2 million shares changed hands — a 168 percent surge in volume compared to the daily norm. Data from AJ Bell identified ITM Power as the most-sold stock on its platform over the previous week. Market observers see textbook profit-taking after a rally that turned a penny stock into a company valued well north of £1 billion.

The selling pressure has arrived despite improving fundamentals. In the first half of its financial year, ITM Power posted record revenue of £18 million, up 16 percent year-on-year. Management raised its full-year guidance to between £40 million and £43 million — above the original target range. The adjusted EBITDA loss narrowed from £18.8 million to £11.9 million.

Government Backing Lifts Ambitions

A key catalyst for the recent optimism was a £86.5 million government support package. Great British Energy is injecting £40 million in equity, while the Department for Energy Security and Net Zero has pledged up to £46.5 million in potential grant funding. The money will finance a new automated production line for ITM’s next-generation “Chronos” electrolyser, targeting an annual capacity of one gigawatt.

Berenberg, the most bullish analyst on the stock, called the state involvement a “compelling seal of approval” for the technology. Even so, its revised price target of 110 pence sits roughly 30 percent below the current trading level. The consensus target stands at just 84.60 pence — implying a 45 percent downside from recent highs.

Operational Progress, But No Profits Yet

The company is gradually shedding its legacy of unprofitable contracts. The share of margin-positive orders in the backlog has climbed to 71 percent, up from 60 percent in April 2025. The gross loss for the half-year narrowed to £6.5 million. ITM Power expects its operating loss for the full year ending April 30 to be no more than £29 million.

Cash reserves stood at nearly £198 million at the end of April, and net liquidity is forecast to reach £215 million by year-end. That provides ample runway, but the valuation remains stretched by any conventional measure. The price-to-sales ratio of 29 is roughly double the industrial sector average. The price-to-book ratio of nearly 4 also exceeds the norm.

A Market That Refuses to Listen to Analysts

The average analyst recommendation sits at “hold,” yet the stock has soared far beyond what any of them consider reasonable. The 50-day moving average currently sits at 75.09 pence — roughly half the current price. As long as the stock stays above that level, the broader uptrend remains intact.

Revenue is expected to triple by 2027. Whether ITM Power can reach profitability along the way is the open question that explains the gulf between market price and analyst targets. The full-year results due at the end of April will show whether the operational momentum can justify a valuation that has already priced in a great deal of success.