Jefferies downgrades Nel, ups Ceres as hydrogen sector faces short-term challenges

Nel ASA

11/11/2024 10:21

** Jefferies cuts Nel  NEL.OL  to "underperform" saying the
Norwegian hydrogen solutions provider's order momentum has
suffered from operational delays
    ** The current backlog of about NOK 1.9 billion ($171.9
million) covers only about one year's worth of revenues, the
broker says
    ** It does not exclude the possibility of further financing
needs by the end of 2025, also due to product development costs 
    ** Nel's shares touch their lowest price since 2018, and are
down 4.3% by 1008 GMT
    ** Within the hydrogen sector, Jefferies upgrades Ceres
Power  CWR.L  on promising recent license contracts with Denso
in Japan and Delta in Taiwan
    ** "Thanks to its high-margin, asset-light licensing model,
Ceres looks best positioned once volumes pick-up," it says
    ** The Ceres Power shares rise 4.5%

 COMPANY      RATING        OLD RATING     NEW PT    OLD PT
 Nel          Underperform  Hold           NOK 3     NOK 5.5
 Ceres Power  Buy           Hold           265p      190p
 PowerCell    Hold          -              SEK 35    SEK 36
 ITM Power    Buy           -              60p       80p
 
($1 = 11.0527 Norwegian crowns)

 (Reporting by Anna Chaberska)
 ((Anna.chaberska@thomsonreuters.com))