Nickel Industries Ltd (ASX: NIC) shares have fallen further into the red today to a new 52-week low.
At the time of writing, the shares are down around 3% to 61 cents each. It's the lowest trading price the ASX nickel shares have reached since May 2025.
The ASX shares have now lost around 45% of their value since reaching a three-year high in mid-May, and they're down around 32% for the year-to-date.
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Why have the shares hit a fresh low today?
There hasn't been any price-sensitive news out of Nickel Industries this week to explain the latest sell-off.
Instead, it looks most likely that this week's tumble is the result of a continued slump in sentiment after the company's latest ASX announcement.
Last Thursday, the company posted its quarterly activities report for the September quarter.
The update included record ore sales of 4.49 million wet metric tonnes (wmt) at its Hengjaya Mine and a 4% increase in group adjusted EBITDA to US$125.9 million quarter-on-quarter.
Nickel Industries said that it is progressing interests in multiple nickel and high-pressure acid leach (HPAL) projects, including expected full ramp-up at its excelsior nickel cobalt (ENC) project once wet season conditions return.
The company said severe El Niño-driven dry conditions affected ore hauling and water supply, temporarily limiting output at some operations. Returning rain and improved water availability is expected in the December quarter.
It looks like investors are spooked by concerns about production cuts and weather-related headwinds.
Nickel Industries shares have also come under downward pressure since June this year. This is when the price of the metal started falling.
At the time of writing, Nickel is trading around $15,500 per tonne as persistent global oversupply and subdued demand restricts prices. For context, nickel spiked to a two-year high of around $19,700 in May, according to Trading Economics data.
Here's why I think the ASX shares are a bargain buy
It's understandable that production cuts have caused concern among investors.
But I still see potential upside ahead for the ASX shares.
The company has shifted its focus toward higher-margin battery-grade materials to diversify its business within the Nickel sector.
It has expanded its product suite to include mixed hydroxide precipitate (MHP), nickel matte, and nickel cathodes. This helps to reduce its reliance on nickel pig iron.
Meanwhile, some experts argue that dry weather conditions are only affecting a portion of the company's output.
Dry weather supports haulage productivity at its Hengjaya Mine, which is tracking ahead of forecasts. And the company's rotary kiln-electric furnace (RKEF) plants in Indonesia, which are used to produce nickel pig iron (NPI) for stainless steel, are also unaffected by weather events.
I see the latest share price declines are mostly driven by fear and sector-wide headwinds, rather than fully supported by company-specific data. When these headwinds taper, I think the company's shares could quickly rebound.
What do the experts tip for the ASX shares next?
The experts are also bullish that we'll see a strong upside ahead.
Market Index data shows that the majority of brokers have a strong buy rating on Nickel Industries shares. The $1.23 average target price implies an upside of around 96% for the ASX shares over the next 12 months, at the time of writing.
