Nel ASA's Backlog Tells a Promising Story Its P&L Can't Yet Confirm

Nel ASA's Q2 orders jump 224% but revenue slips 12%, EBITDA at -155M. CEO vacancy and JPMorgan's cautious stance weigh on shares.

The Norwegian hydrogen equipment maker finds itself squeezed between two competing narratives. Second-quarter figures published in July showed new orders surging 224% to 230 million Norwegian kroner — a clear vote of confidence from customers committing to electrolyser capacity. Yet revenue from customer contracts slipped 12% to 153 million kroner, while EBITDA landed at minus 155 million.

That gap between intake and invoicing now defines the investment case. The order backlog has swollen to 1.213 billion kroner, a substantial cushion for a company of Nel's size. But backlogs are not cash, and the market is waiting to see whether those bookings convert into billable revenue — or whether the company remains stuck with full order books and a bleeding income statement.

Complicating matters is the unresolved question at the top. The CEO's departure was announced in June, and more than a month later no successor has been named. Observers increasingly cite the leadership vacuum as a primary drag on sentiment, with strategic decisions on investment and capacity adjustments harder to make without a permanently installed chief executive.

The share price reflects the standoff. At 0.1968 euro, the stock sits barely above its 50-day moving average of 0.1986 euro — a picture of sideways drift rather than directional conviction. It remains 46% below the 52-week high reached in late May, though the 14% buffer above February's low shows some recovery from the year's worst levels.

The bull case rests on momentum. Nel's shares gained 2.0% over a seven-day stretch, and the proximity to the 52-week trough — roughly 13% below current levels — could be read as support rather than warning. If order intake continues at its current clip and the backlog starts converting into billings, rising revenue alongside shrinking operating losses would mark the strongest signal the market has seen in quarters.

The bear case is the mirror image. A 224% jump in orders sounds dramatic but builds from a low base, and it changes the overall picture only slowly. Should third-quarter revenue fall again while EBITDA stays negative, suspicions would harden that Nel faces structural execution problems — delayed deliveries, ramp-up costs at new facilities, or pricing pressure in a competitive electrolyser market.

JPMorgan has already tilted toward caution, cutting its price target to 1.80 Norwegian kroner in early August while maintaining a neutral rating — evidence that at least one major house weighs earnings quality more heavily than headline order figures.

The next checkpoint arrives on October 21, when Nel reports third-quarter results. That report will show whether the summer's order surge was the beginning of a genuine turnaround or an isolated spike — and whether the leadership question has been resolved in time to give investors confidence in the strategy's execution. Until then, the shares look likely to hold their current range between the 50-day average and the yearly low, with the unresolved CEO search leaving little room for optimism on the downside and the order book providing just enough support on the upside.