Nel ASA: AlphaValue Steps Back to 'Add' as a $12 Million US Order Sits Two Years From Revenue

AlphaValue/Baader Europe cut its rating on Nel ASA from "Buy" to "Add" on Friday and trimmed its price target, a more guarded stance that lands just as the Norwegian hydrogen specialist's order intake tells a very different story from its income statement. The downgrade, which the analyst firm did not accompany with a specific rationale in the coverage, frames the central tension facing investors: bookings are climbing sharply, but the revenue line is still contracting hard.

The third-quarter 2026 figures, released roughly a week ago, lay out that split in plain numbers. Revenue from customer contracts fell 63% year on year to NOK 112 million. Order intake, by contrast, jumped 339% to NOK 253 million, and the order backlog grew 34% to NOK 1,314 million. New orders speak to future work; they do nothing to repair revenue already booked. That timing gap is what makes the quarter hard to read at a glance.

PEM Is Carrying the Growth

The proton exchange membrane business is where the momentum sits. PEM revenue rose 65% to NOK 89 million, moving against the direction of the group total, and PEM order intake climbed 473% to NOK 245 million. That is a firmer signal than a non-binding project review, though it still depends on later delivery and execution.

The most concrete piece of news arrived on 13 October, when subsidiary Nel Hydrogen US booked an order worth around USD 12 million. The buyer is an unnamed US-headquartered global technology group. The scope covers several containerised PEM electrolysers from the MC series plus associated services, with delivery expected in 2027. It gives investors a dated anchor for future revenue — and a reminder that nothing lands on the top line soon.

Alkaline Remains the Drag

Against that, the alkaline business is still bleeding. Alkaline revenue collapsed 91% over the quarter. Group EBITDA came in at minus NOK 93 million and the net loss at NOK 141 million. The problem therefore goes beyond the level of sales: Nel must also demonstrate that a pickup in activity can rein in the losses, and an order scheduled for 2027 delivery does not answer that question.

A letter of intent signed with Rheinmetall roughly a week ago adds an option rather than a revenue line. The two companies plan to examine decentralised synthetic fuel production for defence applications and critical infrastructure, combining Nel's electrolyser technology with Rheinmetall's Giga-PtX concept. The arrangement is non-binding and covers studies and possible pilot projects. Treating it as secured commercial business would be getting ahead of a development step that has not yet happened.

What Would Confirm the Turnaround

For the recovery case to hold, Nel needs more binding orders and — crucially — more revenue flowing from them. Progress on the 2027 US delivery would show whether commercial wins are being converted into operating results. Further firm orders, or the Rheinmetall review hardening into committed projects, could act as additional catalysts, but neither can be assumed in advance.

The balance for investors is straightforward. A confirmed US order and a higher backlog argue for upside. A 63% revenue decline and a NOK 141 million quarterly loss demand hard proof of execution. The two sides of the story would need to converge — through better reported figures, not fresh project announcements alone — before the recovery thesis carries real weight.