Are you interested in investing in the hydrogen industry? If so, you may have heard of NEL ASA, a Norwegian company that specializes in hydrogen production, fueling, and technology.
But what exactly does NEL ASA do, and why should you consider buying its stock? In this article, we will give you a comprehensive overview of NEL ASA’s company profile, its products and services, its strengths and opportunities, its challenges and threats, and its stock performance. By the end of this article, you will have a better understanding of NEL ASA and its potential as an investment.
What is NEL ASA?
NEL ASA is a company that was founded in 1927 as Norsk Hydro-Elektrisk Kvælstofaktieselskab, or Norwegian Hydro-Electric Nitrogen Company.
The company originally produced fertilizer from hydroelectric power, but later diversified into other fields, such as oil and gas, aluminum, and renewable energy. In 2014, the company spun off its hydrogen division as a separate entity, called NEL ASA, and listed it on the Oslo Stock Exchange.
Today, NEL ASA is the largest dedicated hydrogen company in the world, with a vision to enable the hydrogen society by delivering solutions that cover the entire value chain of hydrogen, from production to end-use.
What does NEL ASA do?
NEL ASA’s main business is to provide solutions for the production, storage, distribution, and utilization of hydrogen, a clean and versatile energy carrier that can be used for various applications, such as transportation, industry, power generation, and heating. NEL ASA’s solutions can be divided into three main categories: hydrogen production, hydrogen fueling, and hydrogen technology.
Hydrogen production
NEL ASA produces hydrogen from renewable sources, such as water and electricity, using a process called electrolysis. Electrolysis is the splitting of water molecules into hydrogen and oxygen atoms, using an electric current. NEL ASA offers two types of electrolyzers: alkaline and PEM (proton exchange membrane).
Alkaline electrolyzers use a liquid alkaline solution as the electrolyte, while PEM electrolyzers use a solid polymer membrane as the electrolyte.
Both types of electrolyzers have their own advantages and disadvantages, depending on the application and the operating conditions. NEL ASA’s electrolyzers are modular, scalable, and flexible, and can be integrated with various renewable energy sources, such as wind, solar, hydro, and biomass.
Hydrogen fueling
NEL ASA provides hydrogen fueling solutions for various applications, such as cars, buses, trucks, trains, ships, and forklifts. Hydrogen fueling is the process of dispensing hydrogen gas into a vehicle’s fuel tank, where it is stored under high pressure.
The vehicle then uses a device called a fuel cell to convert the hydrogen and oxygen into electricity and water, which power the vehicle’s motor and emit no harmful emissions.
NEL ASA’s hydrogen fueling stations are designed to be safe, reliable, and efficient, and can deliver hydrogen at different pressures and capacities, depending on the vehicle’s requirements. NEL ASA’s hydrogen fueling stations are also connected to a cloud-based platform, called NEL Connect, which monitors and optimizes the station’s performance and operation.
Hydrogen technology
NEL ASA develops and innovates hydrogen technology for the future, by investing in research and development, and collaborating with other leading companies and organizations in the energy sector. NEL ASA’s hydrogen technology portfolio includes projects such as:
- H2Bus: A consortium of companies that aims to deploy 1,000 hydrogen fuel cell buses and related infrastructure in Europe, to reduce the cost and emissions of public transportation.
- H2Haul: A project that involves developing and testing hydrogen fuel cell trucks for heavy-duty and long-distance transport, to demonstrate the feasibility and benefits of hydrogen mobility for the freight sector.
- HyDeal: An initiative that intends to deliver green hydrogen at a competitive price across Europe, by scaling up the production and distribution of hydrogen from solar power.
- Hybrit: A joint venture between NEL ASA, SSAB, and LKAB, that plans to produce fossil-free steel using hydrogen instead of coal, to reduce the carbon footprint of the steel industry.
Why invest in NEL ASA?
NEL ASA is a company that has a lot of potential as an investment, for several reasons. Here are some of the main factors that make NEL ASA an attractive stock to buy:
Growing market demand
NEL ASA benefits from the increasing demand for hydrogen as a clean energy source, especially in the context of the global climate crisis and the transition to a low-carbon economy.
Hydrogen is seen as a key solution to decarbonize various sectors, such as transportation, industry, power generation, and heating, that are currently dependent on fossil fuels. According to a report by BloombergNEF, the global demand for hydrogen could increase from 70 million tons per year in 2018 to 425 million tons per year in 2050, if the world achieves net-zero emissions by mid-century.
This implies a huge growth opportunity for NEL ASA, as a leading provider of hydrogen solutions.
Competitive advantage
NEL ASA differentiates itself from its competitors in the hydrogen industry, by offering a comprehensive and integrated portfolio of solutions that cover the entire value chain of hydrogen, from production to end-use.
NEL ASA also has a strong track record of delivering high-quality and cost-effective products and services, with over 90 years of experience and expertise in the hydrogen field. NEL ASA also has a global presence and a loyal customer base, with operations in over 30 countries and more than 3,000 installations worldwide.
Strategic partnerships
NEL ASA collaborates with other leading companies and organizations in the energy sector, to create synergies and leverage its strengths. NEL ASA has established partnerships with various players, such as:
- Nikola: A US-based company that develops hydrogen-electric trucks and related infrastructure. NEL ASA is the exclusive supplier of electrolyzers and fueling stations for Nikola’s network in North America and Europe.
- Iberdrola: A Spanish multinational electric utility company that is one of the world’s largest producers of renewable energy. NEL ASA and Iberdrola have signed a framework agreement to develop large-scale green hydrogen projects in Spain and other markets.
- Everfuel: A Danish company that is a spin-off of NEL ASA, and focuses on distributing and selling green hydrogen to end-users. NEL ASA owns a 20% stake in Everfuel, and supports its growth and expansion in Europe.
What are the risks of investing in NEL ASA?
NEL ASA is a company that also faces some challenges and threats, that may affect its business and stock performance. Here are some of the main risks that investors should be aware of:
High volatility
NEL ASA’s stock price fluctuates due to market conditions and investor sentiment, which are influenced by various factors, such as:
- The price and availability of renewable energy, which affect the cost and feasibility of hydrogen production.
- The price and demand of fossil fuels, which affect the competitiveness and attractiveness of hydrogen as an alternative energy source.
- The technological development and innovation in the hydrogen industry, which affect the efficiency and reliability of hydrogen solutions.
- The political and regulatory environment, which affect the support and incentives for hydrogen adoption and deployment.
These factors are often unpredictable and uncertain, and may cause NEL ASA’s stock price to rise or fall significantly in a short period of time. Therefore, investors should be prepared for high volatility and risk when investing in NEL ASA, and not base their decisions on emotions or speculation.
Conclusion
NEL ASA is a company that offers a comprehensive and integrated portfolio of solutions for the production, storage, distribution, and utilization of hydrogen, a clean and versatile energy carrier that can be used for various applications.
NEL ASA has a strong track record of delivering high-quality and cost-effective products and services, and has established strategic partnerships with other leading companies and organizations in the energy sector. NEL ASA also benefits from the increasing demand for hydrogen as a key solution to decarbonize various sectors, especially in the context of the global climate crisis and the transition to a low-carbon economy.
However, NEL ASA also faces some challenges and threats, such as high volatility, regulatory uncertainty, and operational risks, that may affect its business and stock performance. Therefore, investors should do their own research and analysis before investing in NEL ASA, and be aware of the potential rewards and risks of investing in the hydrogen industry.
FAQs
Here are some frequently asked questions and answers about NEL ASA and its stock:
- Q: What is the ticker symbol and the market capitalization of NEL ASA?
- A: The ticker symbol of NEL ASA is NEL, and it is listed on the Oslo Stock Exchange. As of March 5, 2024, the market capitalization of NEL ASA is 49.8 billion NOK, or about 5.8 billion USD.
- Q: What is the dividend policy and the earnings report schedule of NEL ASA?
- A: NEL ASA does not pay any dividends, as it reinvests all of its earnings into its growth and expansion. NEL ASA reports its earnings quarterly, usually in February, May, August, and November.
- Q: How can I buy or sell NEL ASA stock?
- A: You can buy or sell NEL ASA stock through a broker or an online trading platform that offers access to the Oslo Stock Exchange. You may also need to convert your currency to NOK, or Norwegian kroner, before trading.
- Q: What are the main competitors and peers of NEL ASA in the hydrogen industry?
- A: Some of the main competitors and peers of NEL ASA in the hydrogen industry are:
- ITM Power: A UK-based company that produces hydrogen from renewable sources using PEM electrolyzers, and provides hydrogen fueling solutions for various applications.
- Plug Power: A US-based company that develops and manufactures hydrogen fuel cells and related products, and provides hydrogen fueling solutions for various applications.
- Ballard Power Systems: A Canadian company that develops and manufactures hydrogen fuel cells and related products, and provides hydrogen fuel cell solutions for various applications.
- McPhy Energy: A French company that produces hydrogen from renewable sources using alkaline and PEM electrolyzers, and provides hydrogen storage and fueling solutions for various applications.
- Q: What are the main sources and references for learning more about NEL ASA and its stock?
- A: Some of the main sources and references for learning more about NEL ASA and its stock are:
- NEL ASA’s official website: https://nelhydrogen.com/
- NEL ASA’s investor relations page: https://nelhydrogen.com/investor-relations/
- NEL ASA’s annual reports and presentations: https://nelhydrogen.com/annual-reports-and-presentations/
- NEL ASA’s stock information and analysis: https://www.marketbeat.com/stocks/OTCMKTS/NLLSF/
