Nel ASA Stock Surges to 52-Week High, but Underlying Business Pulled in Opposite Directions

Norwegian hydrogen equipment maker Nel ASA rallies 80% YTD to 52-week high, but analysts remain cautious amid weak order intake and a mixed operational picture.

Fast 80 percent year-to-date. A fresh 52-week high just a few days ago. And yet, not a single analyst recommends buying Nel ASA. The Norwegian hydrogen equipment maker has delivered a stunning rally that has left its fundamentals trailing in the dust — and the story is more nuanced than the headline numbers suggest.

The stock now trades at around €0.34, only about three percent below the €0.36 peak touched on 25 May. That peak marked more than a doubling from the year’s low of €0.18, and the share price sits a full two-thirds above its 200-day moving average of €0.21. The annualised 30-day volatility has breached 100 percent, a reflection of the wild swings that have taken hold: Tuesday’s session saw a drop of more than five percent after a near-ten percent surge the day before.

Two Technologies, Two Trajectories

Understanding the disconnect requires looking inside Nel’s two operating segments. The alkaline electrolyser business is showing signs of life. Revenue in the first quarter edged up six percent year-on-year, and the EBITDA deficit narrowed by NOK 35 million compared with the same period a year ago. It was here that Nel unveiled a new pressurised alkaline platform earlier this month — the product of more than eight years of development at its Herøya facility. For a 25 MW project, the company claims system costs below $1,450 per kilowatt, with a hydrogen output pressure of 30 bar and 99.99 percent purity. Those are competitive numbers, but they have yet to translate into orders.

The picture in the PEM segment is markedly different. Revenue slumped 14 percent year-on-year, and the EBITDA loss widened by NOK 16 million. Management blames cancelled or delayed US government funding programmes — a structural headwind, not a one-off blip. The overall first-quarter figures underscore the strain: group revenue slipped to NOK 148 million from NOK 155 million, while the EBITDA loss improved only marginally to minus NOK 100 million. More worryingly, order intake collapsed to NOK 85 million, a drop of nearly 73 percent from the NOK 312 million booked in the same quarter last year. The order backlog shrank to NOK 1,113 million from NOK 1,460 million a year earlier. Operating cash flow was negative NOK 165 million, though a cash pile of roughly NOK 1,443 million provides some runway.

Analysts Hold Fire

The market’s enthusiasm has not been matched on the sell side. Berenberg analyst James Carmichael, who rates the stock at “Neutral,” recently cut his price target to NOK 2.30, pointing to persistent weakness in order activity. No other analyst covering the name has a buy recommendation. The rally, in large part, has been a sympathy move: strong results in the broader fuel-cell segment lifted the entire hydrogen complex, and Nel rode the wave as a follower rather than a leader.

Glimmers in the PEM Sour Patch

Despite the PEM segment’s overall weakness, there are a few straws in the wind. Nel secured two new contracts worth roughly $7 million each in the quarter. One of them is strategically notable: the Douglas County Public Utility District in Washington State — a public utility — has bought a Nel electrolyser system for the first time. The unit will use surplus hydropower for grid stabilisation and is expected online in the first half of 2027. Separately, Nel reports strong demand for its modular PEM systems in the 2.5 MW to 50 MW range, which can be delivered in under 12 months — far faster than custom-built large projects.

The more ambitious play lies further out. Nel plans to build a prototype stack for a new PEM platform in 2026, targeting a reduction in stack costs of around 70 percent. A first prototype is due by the end of this year. Commercial launch is pencilled in for 2028 or 2029. Success would dramatically lower both capital and operating costs, but investors will need patience. An emerging demand segment — defence and security applications — could also provide a new growth vector for decentralised hydrogen production, an area Nel has barely tapped to date.

Near-Term Catalysts and Chart Look

A more immediate catalyst arrives on 15 July, when Nel releases its half-year results. By then, the market will want to see whether ongoing customer discussions have hardened into binding orders. Also expected in the second quarter is an €11 million EU grant tied to the industrialisation of the pressurised-alkaline platform — a welcome liquidity injection that could help bridge the gap between technology promises and real-world demand.

Technically, the stock is not overbought. The relative strength index sits at 55, leaving room for further upside if sentiment turns positive. The hand is still heavy, however, with elevated trading volumes suggesting sustained attention but no clear direction. What the rally ultimately needs is validation from the order book. The next quarterly report will show whether the first-quarter intake collapse was an anomaly or the start of a trend. Until then, Nel’s share price remains a bet on potential — and a very volatile one at that.