Nel ASA Shares Struggle Amid Market Gains

While Norway's benchmark index reached a one-month high, shares of hydrogen technology specialist Nel ASA continued to underperform, closing as one of the session's weakest components. The disconnect highlights the ongoing pressure on the stock despite recent project announcements and strategic moves. We examine the current situation following a share price decline, a major investment decision, and mixed quarterly earnings.

The company's third-quarter figures for 2025, released on October 29, presented a contrasting performance. Revenue from customer contracts fell to NOK 303 million, down from NOK 366 million in the same period last year. Total revenue and other income also declined, moving from NOK 391 million in Q3 2024 to NOK 349 million.

However, there was a notable improvement on the profitability front. The EBITDA loss narrowed significantly to NOK -37 million, a marked improvement from the NOK -90 million loss reported a year earlier. This suggests effective cost control measures are taking hold, even as top-line growth has slowed.

A Major Industrialization Milestone

On December 12, Nel announced a final investment decision to industrialize its Next Generation Pressurized Alkaline platform at its Herøya site in Norway. The board of directors approved plans to build up to 1 GW of production capacity. The project is set to receive support of up to EUR 135 million from the EU Innovation Fund, with disbursements tied to milestone achievements. An initial payout exceeding EUR 10 million is anticipated.

This decision follows a seven-year development program, which included testing a full-scale prototype. The company states the program validated a market-leading system efficiency. A commercial launch is scheduled for the first half of 2026, with scaled delivery capability expected by 2027.

The initial investment is estimated at approximately NOK 300 million before grant funding. Despite this significant technological and industrial advancement, the market's reaction has been muted, with the stock failing to sustain any momentum from the news.

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

Recent Order Intake Strengthens Pipeline

Over recent months, Nel has secured several substantial orders and technology contracts, bolstering its project pipeline:

• November 2025: Selected as the technology provider for the GreenH hydrogen projects in Kristiansund and Slagentangen.
• November 2025: Received a PEM electrolyser order for the HyFuel and Kaupanes hydrogen projects, valued at over USD 50 million.
• October 2025: Secured a third order for a containerized PEM solution from H2 Energy.

These contracts are expected to support capacity utilization in both the PEM and Alkaline business segments over the medium term.

Market Performance and Valuation Context

Nel's shares ended the trading day down 1.93% at NOK 2.24. In contrast, the Oslo OBX Index advanced 0.42%. The broader Norwegian market also showed strength, with 171 gainers outpacing 98 decliners, underscoring the stock's relative weakness.

Key Data Points:
* Daily Performance: -1.93%
* Closing Price: NOK 2.24
* 52-Week Range: NOK 1.95 – NOK 3.61
* Year-to-Date Performance: Approximately -14%

With roughly 1.84 billion shares outstanding, the current price implies a market capitalization of about NOK 4.1 billion. The stock trades well below its 52-week high of NOK 3.61, reflecting the challenging environment for hydrogen-related equities throughout 2025.

The company continues to highlight strategic partnerships, including a cooperation agreement signed with SAMSUNG E&A in March 2025. Following a capital increase, the Korean partner became Nel's largest shareholder. Looking ahead, the pace at which the new alkaline platform can be ramped up and converted into profitable revenue streams will likely be a critical factor for the share price trajectory.