Nel ASA's 57% Rally Rests on a Single Washington State Order and a Promise of Cheaper Electrolysers

Nel ASA's recent stock surge, which has lifted the shares nearly 57% since the start of 2026, owes much to a single landmark deal: the company's first sale of PEM technology to a public utility. The Douglas County Public Utility District in Washington state will use Nel equipment to convert surplus hydropower into green hydrogen, with commissioning slated for the first half of 2027. Yet that welcome headline masks a far grimmer picture beneath the surface.

Order intake in the first quarter collapsed by 73% year-on-year to just 85 million Norwegian kroner. That left the order backlog at 1.113 billion kroner, down 24% from the same period last year. While the company's revenue from customer contracts slipped only 5% to 148 million kroner, the pipeline is clearly shrinking. CEO Håkon Volldal described the start of the year as "quiet" against a backdrop of tepid market demand.

The net loss narrowed, however, and the EBITDA loss improved to minus 100 million kroner from minus 115 million a year earlier, helped by better project execution and ongoing cost-cutting. Nel has trimmed its headcount by 26% from its peak, with personnel expenses down 21% in the quarter. Staff now sits 19% below the prior-year level.

Operationally, the big event came in early May, when Nel launched its next-generation pressurised alkaline electrolyser platform at the automated Herøya site in Norway, after more than eight years of development. The company claims the new system will cut capital expenditure by 40% to 60% compared with conventional market solutions, and push energy consumption below 50 kilowatt-hours per kilogramme of hydrogen. For a 25-megawatt plant, Nel is targeting turnkey costs of under $1,450 per kilowatt, less than half the industry average of roughly $3,000.

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

Industrialisation of that platform is backed by up to €135 million from the EU Innovation Fund, with a first tranche of €11 million expected in the second quarter. Herøya's annual production capacity is set to rise gradually to 4 gigawatts.

But the market is not buying the story. Seven analysts currently rate the stock a sell, with none recommending a buy. The average price target stands at 2.12 Norwegian kroner, well below the last trade in Oslo of 3.22 kroner. Berenberg's James Carmichael cut his target to 2.30 kroner, pointing to persistently weak order intake. Citigroup sees fair value at 2.40 kroner, while RBC Capital Markets rates the shares "neutral" with a 3.00 kroner target. The relative strength index sits at 16, a technical signal that the stock is heavily overbought.

Despite the rally — which has carried the shares from a March trough of 0.18 euros to a current 0.30 euros, just shy of the 52-week high of 0.32 euros reached in early May — the disconnect between price action and fundamentals remains stark. The 68% surge from the March low was driven largely by sector-wide sentiment, as strong results from US hydrogen rivals led investors to bet green hydrogen could play a role in the AI infrastructure boom. European peers ITM Power and Ceres Power also benefited.

Nel ASA at a turning point? This analysis reveals what investors need to know now.

Financially, Nel says it has enough liquidity to last until the end of 2026, with cash and equivalents of 1.443 billion kroner. Board chair Arvid Moss bought 100,000 shares at an average of 2.25 kroner at the end of April, a move seen by market watchers as a vote of confidence.

The next hard test comes on July 15, when Nel delivers its half-year report. By then, the critical question will be whether the new electrolyser platform has begun to translate into concrete orders — or whether the technology narrative continues to run ahead of commercial reality.

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