Download PDF

1. Company Snapshot

1.a. Company Description

Norsk Hydro ASA engages in the power production, bauxite extraction, alumina refining, aluminium smelting, remelting, and recycling activities; and provision of extruded solutions worldwide.It operates through Bauxite & Alumina, Aluminium Metal, Metal Markets, Extrusions, and Energy segments.The Bauxite & Alumina segment engages in bauxite mining activities, production of alumina, and related commercial activities, primarily the sale of alumina.


The Aluminium Metal segment is involved in the primary aluminum production casting activities.This segment principally offers extrusion ingots, foundry alloys, and sheet and standard ingots.The Metal Markets segment sells products from the company's primary metal plants; operates recyclers; and trades in physical and financial metals.


The Extrusions segment offers extrusion profiles, building systems, and precision tubing products for construction, automotive and heating, and ventilation and air conditioning sectors, as well as operates recycling facilities.The Energy segment engages in the trading and wholesale business in Brazil; energy sourcing operations; and operation of power stations in Norway, as well as renewable energy production, such as wind and solar, battery, and hydrogen.Norsk Hydro ASA was founded in 1905 and is headquartered in Oslo, Norway.

Show Full description

1.b. Last Insights on NHY

Norsk Hydro ASA's recent performance has been driven by strong Q2 2025 results, with adjusted EBITDA rising 33% year-over-year to NOK 7,790 million, fueled by higher aluminium and energy prices. The company's capital discipline and cost management also contributed to the positive outcome. Additionally, a recent upgrade to a Zacks Rank #2 (Buy) reflects growing optimism about the company's earnings prospects. Furthermore, Norsk Hydro's collaboration with Mercedes-Benz to provide sustainable aluminium for EV production and its upcoming Q3 2025 results announcement are expected to maintain investor interest. (Source: Zacks)

1.c. Company Highlights

2. Hydro's Q3 2025 Earnings: A Resilient Performance Amid Challenging Market Conditions

Hydro reported a revenue increase of around 1% to NOK 51 billion for Q3 2025 compared to the same quarter last year. The company's adjusted EBITDA decreased from NOK 7.8 billion in Q2 to NOK 6 billion in Q3, mainly due to normalization of eliminations and lower realized aluminum and alumina prices. Adjusted EPS came in at NOK 1.02 per share, beating estimates of NOK 0.869 per share. The company's adjusted net income was NOK 1.9 billion, and net financial income was negative NOK 450 million.

Publication Date: Oct -25

📋 Highlights
  • Adjusted EBITDA: NOK 5.996 billion achieved despite challenging market conditions.
  • Free cash flow: NOK 2.2 billion generated, reflecting strong liquidity.
  • Cost-cutting initiatives: Expected to deliver NOK 7.5 billion EBITDA improvement by 2030.
  • Hydro Extrusions growth: 1% year-over-year sales volume increase in Q3 2025.
  • Aluminum price trend: 3-month LME price rose to USD 2,681 per tonne in 2025.

Segment Performance

Hydro Extrusions sales volumes increased by 1% year-over-year in Q3 2025, with transport volume developments negative but moderating compared to previous quarters. Adjusted EBITDA for Extrusions increased year-over-year to NOK 1.1 billion, driven by positive metal effects. However, the company foresees increasing pressure on margins in both Extrusions and Recycling. Adjusted EBITDA for Aluminum Metal decreased from NOK 3.2 billion to NOK 2.7 billion, driven by negative currency effects and lower all-in metal prices.

Market Outlook and Guidance

The global alumina market balance has normalized since the start of 2025, with new capacity coming online in India, Indonesia, and China. The primary aluminum market is expected to remain roughly balanced in 2025. For Q4, Hydro expects stable production volumes at nameplate capacity, stable fixed costs, and relatively stable raw material costs. The company is keeping the CapEx guidance at NOK 13.5 billion for 2025, and analysts estimate next year's revenue growth at 0.2%.

Valuation and Dividend Yield

Hydro's current valuation metrics indicate a P/E Ratio of 14.08, a P/B Ratio of 1.36, and an EV/EBITDA of 4.7. The company's Dividend Yield is 3.29%, and Free Cash Flow Yield is 7.65%. With an ROIC of 21.23% and an ROE of 9.54%, Hydro's profitability metrics remain strong. The Net Debt / EBITDA ratio is 0.58, indicating a healthy debt position.

3. NewsRoom

Card image cap

How the Story Behind Norsk Hydro Is Evolving with Analyst Upgrades and Strategic Shifts

Nov -27

Source:

Card image cap

Hydro Investor Day 2025: Strategic discipline securing long-term value creation

Nov -27

Source:

Card image cap

Norsk Hydro: Hydro to close five European extrusion plants

Nov -26

Source:

Card image cap

Norsk Hydro: Hydro signs new USD 1,600 million and USD 800 million sustainability-linked revolving credit facilities

Nov -18

Source:

Card image cap

Norsk Hydro: Hydro invests NOK 1.2 billion to build Illvatn pumped storage power plant

Nov -14

Source:

Card image cap

Norsk Hydro (OB:NHY): Evaluating Valuation After Recent Steady Share Price Trend

Oct -29

Source:

Card image cap

Norsk Hydro: Solid results amid uncertain markets

Oct -24

Source:

Card image cap

Despite Fast-paced Momentum, Norsk Hydro ASA (NHYDY) Is Still a Bargain Stock

Oct -06

Source:

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.08%)

6. Segments

Hydro Extrusions

Expected Growth: 2.5%

Hydro Extrusions' 2.5% growth driven by increasing demand for lightweight aluminum products in the automotive and construction industries, coupled with Norsk Hydro ASA's strategic expansion into emerging markets and continuous improvement in operational efficiency.

Hydro Metal Markets

Expected Growth: 1.8%

Norsk Hydro ASA's Hydro Metal Markets segment growth of 1.8% is driven by increasing demand for aluminum products in the automotive and construction industries, coupled with rising prices and improved production efficiency. Additionally, the company's focus on recycling and sustainability initiatives contributes to the growth, as customers prioritize environmentally friendly products.

Hydro Bauxite and Alumina

Expected Growth: 1.2%

Hydro Bauxite and Alumina's 1.2% growth driven by increasing demand for aluminum in electric vehicles, renewable energy infrastructure, and construction. Rising prices of alumina, a key input in aluminum production, also contribute to growth. Additionally, Norsk Hydro ASA's focus on cost reduction, operational efficiency, and strategic partnerships support the segment's expansion.

Hydro Aluminium Metal

Expected Growth: 2.2%

Norsk Hydro ASA's Hydro Aluminium Metal segment growth of 2.2% is driven by increasing demand for lightweight materials in the automotive and aerospace industries, coupled with growing adoption of renewable energy sources. Additionally, the company's focus on recycling and sustainability initiatives, as well as its cost-cutting measures, contribute to the segment's growth.

Hydro Energy

Expected Growth: 3.0%

Norsk Hydro ASA's 3.0% growth in Hydro Energy is driven by increasing global demand for renewable energy, favorable government policies and regulations, and the company's strategic expansion into new markets. Additionally, advancements in hydroelectric power technology and declining production costs contribute to the segment's growth.

Other and Eliminations

Expected Growth: 1.5%

Norsk Hydro ASA's Other and Eliminations segment growth of 1.5% is driven by increased energy sales, higher volumes from the company's aluminum portfolio, and a favorable currency impact. Additionally, the segment benefits from the company's ongoing efforts to optimize its operations and reduce costs, leading to improved profitability.

7. Detailed Products

Primary Aluminium

Norsk Hydro ASA produces high-quality primary aluminium, which is used in various industries such as transportation, construction, and consumer goods.

Aluminium Extrusions

Norsk Hydro ASA offers a range of aluminium extrusions, including profiles, tubes, and rods, used in various applications such as construction, transportation, and consumer goods.

Rolled Products

Norsk Hydro ASA produces rolled aluminium products, including sheets, plates, and coils, used in various industries such as packaging, transportation, and construction.

Recycled Aluminium

Norsk Hydro ASA offers recycled aluminium products, which reduce the environmental impact of aluminium production and support sustainable development.

Bauxite and Alumina

Norsk Hydro ASA extracts and processes bauxite, a raw material used in the production of alumina, which is then used to produce primary aluminium.

Energy

Norsk Hydro ASA generates renewable energy through its hydropower plants, which power its aluminium production and supply excess energy to the grid.

8. Norsk Hydro ASA's Porter Forces

Forces Ranking

Threat Of Substitutes

Norsk Hydro ASA operates in the aluminum and energy industry, where substitutes are limited. However, the increasing demand for sustainable and eco-friendly products may lead to the development of new substitutes, posing a moderate threat to the company.

Bargaining Power Of Customers

Norsk Hydro ASA's customers are primarily industrial companies and manufacturers, who have limited bargaining power due to the company's strong market position and diversified customer base.

Bargaining Power Of Suppliers

Norsk Hydro ASA relies on a few large suppliers for raw materials, giving them some bargaining power. However, the company's strong relationships with suppliers and its ability to negotiate prices mitigate this threat.

Threat Of New Entrants

The aluminum and energy industry has high barriers to entry, including significant capital requirements and regulatory hurdles, making it difficult for new entrants to pose a significant threat to Norsk Hydro ASA.

Intensity Of Rivalry

The aluminum and energy industry is highly competitive, with several large players competing for market share. Norsk Hydro ASA faces intense rivalry from companies like Rio Tinto, Alcoa, and Rusal, which can lead to pricing pressures and reduced market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 23.54%
Debt Cost 10.44%
Equity Weight 76.46%
Equity Cost 10.44%
WACC 10.44%
Leverage 30.79%

11. Quality Control: Norsk Hydro ASA passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Titan Cement

A-Score: 7.0/10

Value: 7.2

Growth: 8.2

Quality: 6.3

Yield: 8.1

Momentum: 5.5

Volatility: 6.7

1-Year Total Return ->

View Full Report
Stock-Card
Grupa Kety

A-Score: 6.5/10

Value: 4.1

Growth: 6.0

Quality: 6.2

Yield: 9.4

Momentum: 6.5

Volatility: 7.0

1-Year Total Return ->

View Full Report
Stock-Card
Navigator

A-Score: 6.5/10

Value: 6.4

Growth: 4.8

Quality: 5.7

Yield: 10.0

Momentum: 2.5

Volatility: 9.7

1-Year Total Return ->

View Full Report
Stock-Card
SSAB

A-Score: 6.4/10

Value: 8.5

Growth: 5.8

Quality: 4.4

Yield: 8.8

Momentum: 7.5

Volatility: 3.3

1-Year Total Return ->

View Full Report
Stock-Card
Norsk Hydro

A-Score: 6.2/10

Value: 6.8

Growth: 6.3

Quality: 5.4

Yield: 7.5

Momentum: 4.0

Volatility: 7.0

1-Year Total Return ->

View Full Report
Stock-Card
Constellium

A-Score: 3.0/10

Value: 6.7

Growth: 2.9

Quality: 2.1

Yield: 0.0

Momentum: 5.0

Volatility: 1.3

1-Year Total Return ->

View Full Report

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

73.96$

Current Price

73.96$

Potential

-0.00%

Expected Cash-Flows