ENERGY RECOVERY INC (ERII) Fundamental Analysis & Valuation
NASDAQ:ERII • US29270J1007
Current stock price
10.2 USD
-0.02 (-0.2%)
At close:
10.22 USD
+0.02 (+0.2%)
After Hours:
This ERII fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.
1. ERII Profitability Analysis
1.1 Basic Checks
- ERII had positive earnings in the past year.
- ERII had a positive operating cash flow in the past year.
- ERII had positive earnings in each of the past 5 years.
- ERII had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- The Return On Assets of ERII (9.92%) is better than 81.68% of its industry peers.
- The Return On Equity of ERII (11.14%) is better than 62.60% of its industry peers.
- ERII has a Return On Invested Capital of 9.76%. This is in the better half of the industry: ERII outperforms 71.76% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for ERII is in line with the industry average of 10.17%.
- The last Return On Invested Capital (9.76%) for ERII is above the 3 year average (8.54%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.92% | ||
| ROE | 11.14% | ||
| ROIC | 9.76% |
ROA(3y)9.3%
ROA(5y)9.13%
ROE(3y)10.63%
ROE(5y)10.57%
ROIC(3y)8.54%
ROIC(5y)8.51%
1.3 Margins
- ERII's Profit Margin of 17.01% is amongst the best of the industry. ERII outperforms 92.37% of its industry peers.
- In the last couple of years the Profit Margin of ERII has declined.
- The Operating Margin of ERII (17.93%) is better than 83.21% of its industry peers.
- ERII's Operating Margin has declined in the last couple of years.
- ERII has a Gross Margin of 65.14%. This is amongst the best in the industry. ERII outperforms 100.00% of its industry peers.
- ERII's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.93% | ||
| PM (TTM) | 17.01% | ||
| GM | 65.14% |
OM growth 3Y-3.21%
OM growth 5Y-8.68%
PM growth 3Y-3.87%
PM growth 5Y-5.17%
GM growth 3Y-2.16%
GM growth 5Y-3.09%
2. ERII Health Analysis
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so ERII is destroying value.
- Compared to 1 year ago, ERII has less shares outstanding
- Compared to 5 years ago, ERII has less shares outstanding
- ERII has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
- ERII has an Altman-Z score of 15.32. This indicates that ERII is financially healthy and has little risk of bankruptcy at the moment.
- ERII's Altman-Z score of 15.32 is amongst the best of the industry. ERII outperforms 96.95% of its industry peers.
- ERII has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 15.32 |
ROIC/WACC0.95
WACC10.24%
2.3 Liquidity
- ERII has a Current Ratio of 10.44. This indicates that ERII is financially healthy and has no problem in meeting its short term obligations.
- ERII has a better Current ratio (10.44) than 96.18% of its industry peers.
- A Quick Ratio of 9.04 indicates that ERII has no problem at all paying its short term obligations.
- ERII has a Quick ratio of 9.04. This is amongst the best in the industry. ERII outperforms 95.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 10.44 | ||
| Quick Ratio | 9.04 |
3. ERII Growth Analysis
3.1 Past
- The Earnings Per Share has grown by an impressive 20.00% over the past year.
- Measured over the past 5 years, ERII shows a small growth in Earnings Per Share. The EPS has been growing by 1.55% on average per year.
- Looking at the last year, ERII shows a decrease in Revenue. The Revenue has decreased by -6.87% in the last year.
- Measured over the past years, ERII shows a small growth in Revenue. The Revenue has been growing by 2.55% on average per year.
EPS 1Y (TTM)20%
EPS 3Y7.89%
EPS 5Y1.55%
EPS Q2Q%17.78%
Revenue 1Y (TTM)-6.87%
Revenue growth 3Y2.43%
Revenue growth 5Y2.55%
Sales Q2Q%-0.3%
3.2 Future
- ERII is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 51.49% yearly.
- Based on estimates for the next years, ERII will show a quite strong growth in Revenue. The Revenue will grow by 15.41% on average per year.
EPS Next Y47.33%
EPS Next 2Y51.49%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year-19.52%
Revenue Next 2Y-1.5%
Revenue Next 3Y4.67%
Revenue Next 5Y15.41%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. ERII Valuation Analysis
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 18.89, which indicates a rather expensive current valuation of ERII.
- ERII's Price/Earnings ratio is a bit cheaper when compared to the industry. ERII is cheaper than 74.81% of the companies in the same industry.
- The average S&P500 Price/Earnings ratio is at 25.60. ERII is valued slightly cheaper when compared to this.
- With a Price/Forward Earnings ratio of 12.82, ERII is valued correctly.
- ERII's Price/Forward Earnings ratio is rather cheap when compared to the industry. ERII is cheaper than 87.79% of the companies in the same industry.
- ERII's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.84.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.89 | ||
| Fwd PE | 12.82 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as ERII.
- ERII's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.9 | ||
| EV/EBITDA | 15.61 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- ERII has a very decent profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as ERII's earnings are expected to grow with 51.49% in the coming years.
PEG (NY)0.4
PEG (5Y)12.18
EPS Next 2Y51.49%
EPS Next 3YN/A
5. ERII Dividend Analysis
5.1 Amount
- No dividends for ERII!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
ERII Fundamentals: All Metrics, Ratios and Statistics
10.2
-0.02 (-0.2%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)02-25 2026-02-25/amc
Earnings (Next)05-05 2026-05-05
Inst Owners93.4%
Inst Owner Change-1.28%
Ins Owners3.15%
Ins Owner Change2.64%
Market Cap538.87M
Revenue(TTM)134.99M
Net Income(TTM)22.96M
Analysts81.82
Price Target14.45 (41.67%)
Short Float %3.03%
Short Ratio2.27
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-4.3%
Min EPS beat(2)-22.45%
Max EPS beat(2)13.86%
EPS beat(4)2
Avg EPS beat(4)366.02%
Min EPS beat(4)-488.23%
Max EPS beat(4)1960.88%
EPS beat(8)5
Avg EPS beat(8)204.28%
EPS beat(12)7
Avg EPS beat(12)138.75%
EPS beat(16)9
Avg EPS beat(16)113.57%
Revenue beat(2)0
Avg Revenue beat(2)-12.64%
Min Revenue beat(2)-20.54%
Max Revenue beat(2)-4.74%
Revenue beat(4)1
Avg Revenue beat(4)-20.26%
Min Revenue beat(4)-63.91%
Max Revenue beat(4)8.15%
Revenue beat(8)2
Avg Revenue beat(8)-4.17%
Revenue beat(12)4
Avg Revenue beat(12)-3.76%
Revenue beat(16)6
Avg Revenue beat(16)-3.65%
PT rev (1m)-22.33%
PT rev (3m)-22.33%
EPS NQ rev (1m)-25.33%
EPS NQ rev (3m)-25.33%
EPS NY rev (1m)-10.34%
EPS NY rev (3m)-10.34%
Revenue NQ rev (1m)-27.99%
Revenue NQ rev (3m)-27.99%
Revenue NY rev (1m)-26.3%
Revenue NY rev (3m)-26.07%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.89 | ||
| Fwd PE | 12.82 | ||
| P/S | 3.99 | ||
| P/FCF | 30.9 | ||
| P/OCF | 28.71 | ||
| P/B | 2.61 | ||
| P/tB | 2.79 | ||
| EV/EBITDA | 15.61 |
EPS(TTM)0.54
EY5.29%
EPS(NY)0.8
Fwd EY7.8%
FCF(TTM)0.33
FCFY3.24%
OCF(TTM)0.36
OCFY3.48%
SpS2.56
BVpS3.9
TBVpS3.66
PEG (NY)0.4
PEG (5Y)12.18
Graham Number6.89
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.92% | ||
| ROE | 11.14% | ||
| ROCE | 11.3% | ||
| ROIC | 9.76% | ||
| ROICexc | 15.05% | ||
| ROICexgc | 16.58% | ||
| OM | 17.93% | ||
| PM (TTM) | 17.01% | ||
| GM | 65.14% | ||
| FCFM | 12.92% |
ROA(3y)9.3%
ROA(5y)9.13%
ROE(3y)10.63%
ROE(5y)10.57%
ROIC(3y)8.54%
ROIC(5y)8.51%
ROICexc(3y)14%
ROICexc(5y)15.05%
ROICexgc(3y)15.48%
ROICexgc(5y)16.92%
ROCE(3y)9.88%
ROCE(5y)9.86%
ROICexgc growth 3Y-9.43%
ROICexgc growth 5Y-18.99%
ROICexc growth 3Y-8.57%
ROICexc growth 5Y-17.46%
OM growth 3Y-3.21%
OM growth 5Y-8.68%
PM growth 3Y-3.87%
PM growth 5Y-5.17%
GM growth 3Y-2.16%
GM growth 5Y-3.09%
F-Score6
Asset Turnover0.58
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 35.37% | ||
| Cap/Sales | 0.99% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 67.13% | ||
| Profit Quality | 75.95% | ||
| Current Ratio | 10.44 | ||
| Quick Ratio | 9.04 | ||
| Altman-Z | 15.32 |
F-Score6
WACC10.24%
ROIC/WACC0.95
Cap/Depr(3y)43.34%
Cap/Depr(5y)66.27%
Cap/Sales(3y)1.29%
Cap/Sales(5y)2.74%
Profit Quality(3y)89.52%
Profit Quality(5y)70.3%
High Growth Momentum
Growth
EPS 1Y (TTM)20%
EPS 3Y7.89%
EPS 5Y1.55%
EPS Q2Q%17.78%
EPS Next Y47.33%
EPS Next 2Y51.49%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)-6.87%
Revenue growth 3Y2.43%
Revenue growth 5Y2.55%
Sales Q2Q%-0.3%
Revenue Next Year-19.52%
Revenue Next 2Y-1.5%
Revenue Next 3Y4.67%
Revenue Next 5Y15.41%
EBIT growth 1Y9.02%
EBIT growth 3Y-0.85%
EBIT growth 5Y-6.35%
EBIT Next Year40.79%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-9.28%
FCF growth 3Y27.58%
FCF growth 5Y11.59%
OCF growth 1Y-8.54%
OCF growth 3Y14.11%
OCF growth 5Y2.16%
ENERGY RECOVERY INC / ERII Fundamental Analysis FAQ
What is the ChartMill fundamental rating of ENERGY RECOVERY INC (ERII) stock?
ChartMill assigns a fundamental rating of 7 / 10 to ERII.
What is the valuation status of ENERGY RECOVERY INC (ERII) stock?
ChartMill assigns a valuation rating of 6 / 10 to ENERGY RECOVERY INC (ERII). This can be considered as Fairly Valued.
What is the profitability of ERII stock?
ENERGY RECOVERY INC (ERII) has a profitability rating of 7 / 10.
What are the PE and PB ratios of ENERGY RECOVERY INC (ERII) stock?
The Price/Earnings (PE) ratio for ENERGY RECOVERY INC (ERII) is 18.89 and the Price/Book (PB) ratio is 2.61.