ITM Power: A Week of Whipsaws and Three June Decisions That Could Define Its Next Move

It was a week that made no sense on the surface. ITM Power announced a £40 million investment from Great British Energy, inked a framework partnership with Protium, and saw its liquidly guidance raised. Yet the stock shed 26.75% in five sessions, closing at €1.68 on Friday – a 14.45% single-day plunge. The paradox points to three distinct forces that overwhelmed the positive headlines.

First, the MSCI effect. ITM Power’s inclusion in the MSCI UK Small Cap Index at the end of May triggered a textbook “sell the fact” reaction. Hedge funds that had piled in ahead of the rebalancing unwound their positions as soon as the index change took effect, flooding the market with supply. Within days the shares slipped below €1.70.

Second, Goldman Sachs piled on. On Friday the bank reaffirmed its “sell” rating, raising its price target only marginally from 55p to 63p – still well below the current level. Analysts there argue that ITM Power remains fundamentally overvalued and will not reach profitability in the near term. The call landed like a hammer during an already fragile session.

Third, the broader hydrogen sector caught a chill. Ballard Power Systems fell 19%, Plug Power dropped roughly 12%, and Clean Power Hydrogen suspended trading after a pilot electrolyser was irreparably damaged. The incident reignited doubts about technological readiness across the industry, and ITM Power was swept up in the contagion.

The Fundamentals Are Quietly Improving

Beneath the market noise, the company’s operational trajectory is moving in the right direction. Great British Energy now holds a 10.4% stake after its £40 million investment, making it the second-largest shareholder. That injection, combined with a previously announced £46.5 million government grant for automating the Sheffield factory, lifted ITM Power’s net liquidity forecast to between £210 million and £215 million – up from an earlier range of £170 million to £175 million.

Revenue hit a record £18 million in the first half of fiscal 2026, and the full-year forecast stands at £40 million to £43 million. The order backlog reached £152 million, of which 71% is considered profitable. Adjusted EBITDA losses narrowed to £11.9 million. Even the cash burn is improving.

Still, the Protium deal is a framework agreement, not a binding offtake contract. A final investment decision on the Cromarty project is not expected before December 2026, meaning material revenues from that partnership will not appear this year.

Should investors sell immediately? Or is it worth buying ITM Power?

Three Binary Catalysts in June

The market’s attention is now fixed on a trio of near-term events, each capable of swinging the share price sharply.

The most immediate is the Competition and Markets Authority’s decision on the Chronos grant. The UK regulator is expected to sign off in June on the £46.5 million subsidy for the next-generation stack line. Management has said it will only make a final investment decision on Chronos once the grant is confirmed. Jefferies has warned that a negative outcome carries a 52% downside risk.

Also on the agenda is the UK’s HAR2 hydrogen auction, which could allocate capacity of up to 875 MW. ITM Power is already named as preferred supplier for two projects, though both await final investment decisions from developers. Contracts are scheduled to be awarded by the end of 2026, but early signals could emerge as soon as June.

Then there is Uniper’s Humber H2ub in Killingholme, where ITM Power is lined up to supply six POSEIDON modules of 20 MW each for the first phase. Uniper targets commissioning in 2029, but the scope could later expand beyond 200 MW. A FEED contract was signed in June 2025 and planning permission granted in March 2026. Uniper’s final investment decision on the initial stage is also expected this month.

Analyst Views Are Poles Apart

The divergence among sell-side firms underscores the binary nature of ITM Power’s story. Jefferies raised its target from 115p to 200p and remains bullish; Morgan Stanley now expects EBITDA breakeven in fiscal 2028, a year earlier than before. Berenberg still rates the stock a “buy” but cut its target to 110p. UBS sits neutral at 60p. Goldman Sachs’ sell recommendation at 63p is the outlier on the bear side.

Inside the company, the signals are mixed. Technology chief Simon Bourne sold the bulk of his 1.3 million stock options at an average price of 157.44p, citing tax obligations, though he retained around 656,000 shares. CEO Dennis Schulz, by contrast, has his entire package of 1.3 million shares tied to the successful delivery of Chronos and profitable contracts.

Technically Bruised but Not Broken

The stock now trades 35% below its May 29 high, but remains 158.6% above its February 6 low. The relative strength index has slipped to 42.3, and annualised 30-day volatility stands at a stomach-churning 103%. The next hard stop on the calendar is September 15, when ITM Power reports full-year results. Until then, the June decisions will determine whether last week’s rout was a temporary shakeout or the beginning of a steeper correction.