Nel ASA Shares Face Volatility Amid Conflicting Market Signals

Investors in Nel ASA are navigating turbulent trading conditions as the hydrogen technology company's stock experiences significant price swings. Recent substantial contract wins have failed to sustain momentum, with profit-taking activity erasing earlier gains and creating a tense standoff between fundamental developments and short-term market sentiment.

The backdrop to current market movements includes concerning financial results released on October 29. The quarterly report highlighted several troubling metrics:

• Revenue declined by 17 percent to 303 million Norwegian kroner
• New orders amounted to just 57 million NOK, indicating weak near-term demand

These figures underscore the operational challenges facing the hydrogen specialist despite positive long-term industry trends.

Major Contract Provides Much-Needed Boost

Against this sobering financial landscape, Nel ASA announced a significant development on November 5—a firm purchase order for 40 MW of PEM electrolyser systems valued at over $50 million. This transaction represents the company's second-largest firm order historically and the biggest ever for its PEM technology portfolio.

Market reaction was immediately positive, with shares surging approximately 20 percent on November 6 as investors welcomed the substantial contract win. The order brings crucial momentum to the company's project pipeline and directly addresses investor concerns about future revenue visibility.

Should investors sell immediately? Or is it worth buying Nel ASA?

Rally Proves Short-Lived as Selling Pressure Emerges

The enthusiasm surrounding the contract announcement proved temporary. By the end of last week, Nel ASA shares had reversed direction, declining more than 6 percent in a single trading session. Market analysts attribute this pullback to technical profit-taking following the rapid price appreciation, a common pattern after sharp upward moves.

Insider Transaction Signals Executive Confidence

Coinciding with the rally, Hans Hide, Chief Project Officer at Nel ASA, reported acquiring 10,000 company shares. Following this transaction, the executive now holds 40,000 shares directly along with 600,000 options. Such insider purchases are frequently interpreted as expressions of confidence in the company's strategic direction and long-term prospects.

Delivery Timeline Tests Investor Patience

The systems for the HyFuel and Kaupanes projects are scheduled for delivery beginning in the second half of 2026 through 2027, with commercial operations expected to commence in early 2028. This extended timeline means investors must demonstrate considerable patience while enduring ongoing price volatility in the interim.

The central question facing market participants remains whether operational successes can ultimately overcome the current downward pressure and generate sustainable shareholder value over the long term.