14.3 USD
-0.33 (-2.26%)
14.3 USD
0 (0%)
ERII gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 132 industry peers in the Machinery industry. Both the health and profitability get an excellent rating, making ERII a very profitable company, without any liquidiy or solvency issues. ERII is not overvalued while it is showing excellent growth. This is an interesting combination. These ratings could make ERII a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
- In the past year ERII was profitable.
- ERII had a positive operating cash flow in the past year.
- Each year in the past 5 years ERII has been profitable.
- ERII had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With a decent Return On Assets value of 9.31%, ERII is doing good in the industry, outperforming 78.03% of the companies in the same industry.
- ERII's Return On Equity of 10.79% is fine compared to the rest of the industry. ERII outperforms 65.91% of its industry peers.
- With a decent Return On Invested Capital value of 8.89%, ERII is doing good in the industry, outperforming 64.39% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for ERII is below the industry average of 10.24%.
- The 3 year average ROIC (8.12%) for ERII is below the current ROIC(8.89%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.31% | ||
| ROE | 10.79% | ||
| ROIC | 8.89% |
ROA(3y)9.69%
ROA(5y)9.73%
ROE(3y)11.24%
ROE(5y)11.42%
ROIC(3y)8.12%
ROIC(5y)8.81%
1.3 Margins
- Looking at the Profit Margin, with a value of 14.44%, ERII belongs to the top of the industry, outperforming 85.61% of the companies in the same industry.
- ERII's Profit Margin has improved in the last couple of years.
- ERII's Operating Margin of 15.68% is fine compared to the rest of the industry. ERII outperforms 72.73% of its industry peers.
- In the last couple of years the Operating Margin of ERII has grown nicely.
- ERII's Gross Margin of 66.64% is amongst the best of the industry. ERII outperforms 99.24% of its industry peers.
- In the last couple of years the Gross Margin of ERII has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 15.68% | ||
| PM (TTM) | 14.44% | ||
| GM | 66.64% |
OM growth 3Y4.79%
OM growth 5Y5.06%
PM growth 3Y5.01%
PM growth 5Y4.86%
GM growth 3Y-0.83%
GM growth 5Y-2.69%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ERII is destroying value.
- Compared to 1 year ago, ERII has less shares outstanding
- Compared to 5 years ago, ERII has less shares outstanding
- There is no outstanding debt for ERII. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
- ERII has an Altman-Z score of 18.20. This indicates that ERII is financially healthy and has little risk of bankruptcy at the moment.
- ERII's Altman-Z score of 18.20 is amongst the best of the industry. ERII outperforms 97.73% of its industry peers.
- There is no outstanding debt for ERII. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 18.2 |
ROIC/WACC0.91
WACC9.77%
2.3 Liquidity
- ERII has a Current Ratio of 7.33. This indicates that ERII is financially healthy and has no problem in meeting its short term obligations.
- The Current ratio of ERII (7.33) is better than 94.70% of its industry peers.
- ERII has a Quick Ratio of 5.75. This indicates that ERII is financially healthy and has no problem in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 5.75, ERII belongs to the top of the industry, outperforming 94.70% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 7.33 | ||
| Quick Ratio | 5.75 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 35.29% over the past year.
- ERII shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 20.11% yearly.
- Looking at the last year, ERII shows a small growth in Revenue. The Revenue has grown by 0.10% in the last year.
- The Revenue has been growing by 10.77% on average over the past years. This is quite good.
EPS 1Y (TTM)35.29%
EPS 3Y21.64%
EPS 5Y20.11%
EPS Q2Q%-20%
Revenue 1Y (TTM)0.1%
Revenue growth 3Y11.74%
Revenue growth 5Y10.77%
Sales Q2Q%-17.06%
3.2 Future
- ERII is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 40.17% yearly.
- ERII is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.66% yearly.
EPS Next Y61.69%
EPS Next 2Y40.43%
EPS Next 3Y40.17%
EPS Next 5YN/A
Revenue Next Year3.83%
Revenue Next 2Y6.37%
Revenue Next 3Y8.76%
Revenue Next 5Y13.66%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 31.09, which means the current valuation is very expensive for ERII.
- ERII's Price/Earnings ratio is in line with the industry average.
- When comparing the Price/Earnings ratio of ERII to the average of the S&P500 Index (27.21), we can say ERII is valued inline with the index average.
- ERII is valuated correctly with a Price/Forward Earnings ratio of 16.11.
- 79.55% of the companies in the same industry are more expensive than ERII, based on the Price/Forward Earnings ratio.
- The average S&P500 Price/Forward Earnings ratio is at 25.98. ERII is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.09 | ||
| Fwd PE | 16.11 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, ERII is valued a bit more expensive than 68.94% of the companies in the same industry.
- ERII's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.11 | ||
| EV/EBITDA | 26.06 |
4.3 Compensation for Growth
- ERII's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The decent profitability rating of ERII may justify a higher PE ratio.
- A more expensive valuation may be justified as ERII's earnings are expected to grow with 40.17% in the coming years.
PEG (NY)0.5
PEG (5Y)1.55
EPS Next 2Y40.43%
EPS Next 3Y40.17%
5. Dividend
5.1 Amount
- ERII does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
ENERGY RECOVERY INC / ERII FAQ
What is the ChartMill fundamental rating of ENERGY RECOVERY INC (ERII) stock?
ChartMill assigns a fundamental rating of 7 / 10 to ERII.
Can you provide the valuation status for ENERGY RECOVERY INC?
ChartMill assigns a valuation rating of 5 / 10 to ENERGY RECOVERY INC (ERII). This can be considered as Fairly Valued.
How profitable is ENERGY RECOVERY INC (ERII) stock?
ENERGY RECOVERY INC (ERII) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for ERII stock?
The Price/Earnings (PE) ratio for ENERGY RECOVERY INC (ERII) is 31.09 and the Price/Book (PB) ratio is 4.19.
What is the expected EPS growth for ENERGY RECOVERY INC (ERII) stock?
The Earnings per Share (EPS) of ENERGY RECOVERY INC (ERII) is expected to grow by 61.69% in the next year.