14.59 USD
-0.19 (-1.29%)
At close: Jan 30, 2026
14.59 USD
0 (0%)
After Hours: 1/30/2026, 8:00:02 PM
Overall ERII gets a fundamental rating of 7 out of 10. We evaluated ERII 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. With these ratings, ERII could be worth investigating further for growth and quality investing!.
1. Profitability
1.1 Basic Checks
- ERII had positive earnings in the past year.
- In the past year ERII had a positive cash flow from operations.
- ERII had positive earnings in each of the past 5 years.
- Each year in the past 5 years ERII had a positive operating cash flow.
1.2 Ratios
- ERII has a Return On Assets of 9.31%. This is in the better half of the industry: ERII outperforms 78.03% of its industry peers.
- ERII has a Return On Equity of 10.79%. This is in the better half of the industry: ERII outperforms 65.91% of its industry peers.
- ERII has a Return On Invested Capital of 8.89%. This is in the better half of the industry: ERII outperforms 64.39% of its industry peers.
- ERII had an Average Return On Invested Capital over the past 3 years of 8.12%. This is below the industry average of 10.20%.
- The last Return On Invested Capital (8.89%) for ERII is above the 3 year average (8.12%), which is a sign of increasing profitability.
| 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
- ERII's Profit Margin of 14.44% is amongst the best of the industry. ERII outperforms 85.61% of its industry peers.
- ERII's Profit Margin has improved in the last couple of years.
- Looking at the Operating Margin, with a value of 15.68%, ERII is in the better half of the industry, outperforming 72.73% of the companies in the same industry.
- ERII's Operating Margin has improved in the last couple of years.
- Looking at the Gross Margin, with a value of 66.64%, ERII belongs to the top of the industry, outperforming 99.24% of the companies in the same industry.
- ERII's Gross Margin has declined in the last couple of years.
| 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.
- The number of shares outstanding for ERII has been reduced compared to 1 year ago.
- ERII has less shares outstanding than it did 5 years ago.
- 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 18.73. This indicates that ERII is financially healthy and has little risk of bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 18.73, ERII belongs to the top of the industry, outperforming 97.73% of the companies in the same industry.
- 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 | 18.73 |
ROIC/WACC0.92
WACC9.66%
2.3 Liquidity
- A Current Ratio of 7.33 indicates that ERII has no problem at all paying its short term obligations.
- ERII has a better Current ratio (7.33) 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.
- The Quick ratio of ERII (5.75) is better than 94.70% of its industry peers.
| 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.
- Measured over the past years, ERII shows a very strong growth in Earnings Per Share. The EPS has been growing by 20.11% on average per year.
- The Revenue has been growing slightly by 0.10% in the past year.
- ERII shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 10.77% yearly.
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.
- Based on estimates for the next years, ERII will show a quite strong growth in Revenue. The Revenue will grow by 13.66% on average per year.
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
- With a Price/Earnings ratio of 31.72, ERII can be considered very expensive at the moment.
- ERII's Price/Earnings ratio is in line with the industry average.
- The average S&P500 Price/Earnings ratio is at 28.30. ERII is around the same levels.
- Based on the Price/Forward Earnings ratio of 16.44, the valuation of ERII can be described as correct.
- Based on the Price/Forward Earnings ratio, ERII is valued a bit cheaper than the industry average as 78.03% of the companies are valued more expensively.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.57, ERII is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.72 | ||
| Fwd PE | 16.44 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ERII indicates a slightly more expensive valuation: ERII is more expensive than 70.45% of the companies listed in the same industry.
- ERII's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.88 | ||
| EV/EBITDA | 27.05 |
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)0.51
PEG (5Y)1.58
EPS Next 2Y40.43%
EPS Next 3Y40.17%
5. Dividend
5.1 Amount
- No dividends for ERII!.
| 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 31.72 and the Price/Book (PB) ratio is 4.27.
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.