ENERGY RECOVERY INC (ERII) Fundamental Analysis & Valuation

NASDAQ:ERII • US29270J1007

Current stock price

9.91 USD
+0.1 (+1.02%)
Last:

This ERII fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

7

1. ERII Profitability Analysis

1.1 Basic Checks

  • In the past year ERII was profitable.
  • 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.
ERII Yearly Net Income VS EBIT VS OCF VS FCFERII Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 10M 20M 30M

1.2 Ratios

  • The Return On Assets of ERII (9.92%) is better than 81.68% of its industry peers.
  • Looking at the Return On Equity, with a value of 11.14%, ERII is in the better half of the industry, outperforming 62.60% of the companies in the same industry.
  • ERII has a better Return On Invested Capital (9.76%) than 71.76% of its industry peers.
  • ERII had an Average Return On Invested Capital over the past 3 years of 8.54%. This 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 RankSector 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%
ERII Yearly ROA, ROE, ROICERII Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5 10 15 20

1.3 Margins

  • Looking at the Profit Margin, with a value of 17.01%, ERII belongs to the top of the industry, outperforming 92.37% of the companies in the same industry.
  • ERII's Profit Margin has declined in the last couple of years.
  • 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's Gross Margin of 65.14% is amongst the best of the industry. ERII outperforms 100.00% of its industry peers.
  • In the last couple of years the Gross Margin of ERII has declined.
Industry RankSector 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%
ERII Yearly Profit, Operating, Gross MarginsERII Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20 40 60

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9

2. ERII Health Analysis

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.
  • 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.
ERII Yearly Shares OutstandingERII Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10M 20M 30M 40M 50M
ERII Yearly Total Debt VS Total AssetsERII Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 50M 100M 150M 200M 250M

2.2 Solvency

  • An Altman-Z score of 14.84 indicates that ERII is not in any danger for bankruptcy at the moment.
  • The Altman-Z score of ERII (14.84) is better than 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 RankSector Rank
Debt/Equity 0
Debt/FCF 0
Altman-Z 14.84
ROIC/WACC0.95
WACC10.23%
ERII Yearly LT Debt VS Equity VS FCFERII Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0 50M 100M 150M 200M

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.
  • Looking at the Current ratio, with a value of 10.44, ERII belongs to the top of the industry, outperforming 96.18% of the companies in the same industry.
  • A Quick Ratio of 9.04 indicates that ERII has no problem at all paying its short term obligations.
  • Looking at the Quick ratio, with a value of 9.04, ERII belongs to the top of the industry, outperforming 95.42% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 10.44
Quick Ratio 9.04
ERII Yearly Current Assets VS Current LiabilitesERII Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 50M 100M 150M

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

6

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.
  • ERII shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.55% yearly.
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

  • The Earnings Per Share is expected to grow by 51.49% on average over the next years. This is a very strong growth
  • 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

  • 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.
ERII Yearly Revenue VS EstimatesERII Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 100M 200M 300M
ERII Yearly EPS VS EstimatesERII Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 0 0.5 1

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6

4. ERII Valuation Analysis

4.1 Price/Earnings Ratio

  • Based on the Price/Earnings ratio of 18.35, the valuation of ERII can be described as rather expensive.
  • Based on the Price/Earnings ratio, ERII is valued a bit cheaper than the industry average as 75.57% of the companies are valued more expensively.
  • Compared to an average S&P500 Price/Earnings ratio of 24.75, ERII is valued a bit cheaper.
  • A Price/Forward Earnings ratio of 12.46 indicates a correct valuation of ERII.
  • 87.79% of the companies in the same industry are more expensive than ERII, based on the Price/Forward Earnings ratio.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 22.10, ERII is valued a bit cheaper.
Industry RankSector Rank
PE 18.35
Fwd PE 12.46
ERII Price Earnings VS Forward Price EarningsERII Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20

4.2 Price Multiples

  • ERII's Enterprise Value to EBITDA ratio is in line with the industry average.
  • ERII's Price/Free Cash Flow is on the same level as the industry average.
Industry RankSector Rank
P/FCF 30.02
EV/EBITDA 14.87
ERII Per share dataERII EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 1 2 3

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.
  • ERII's earnings are expected to grow with 51.49% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.39
PEG (5Y)11.83
EPS Next 2Y51.49%
EPS Next 3YN/A

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

0

5. ERII Dividend Analysis

5.1 Amount

  • ERII does not give a dividend.
Industry RankSector Rank
Dividend Yield 0%

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ERII Fundamentals: All Metrics, Ratios and Statistics

ENERGY RECOVERY INC

NASDAQ:ERII (3/31/2026, 1:10:49 PM)

9.91

+0.1 (+1.02%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)02-25
Earnings (Next)05-05
Inst Owners93.4%
Inst Owner Change-1.28%
Ins Owners3.15%
Ins Owner Change2.64%
Market Cap523.55M
Revenue(TTM)134.99M
Net Income(TTM)22.96M
Analysts81.82
Price Target14.45 (45.81%)
Short Float %3.03%
Short Ratio2.27
Dividend
Industry RankSector 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 RankSector Rank
PE 18.35
Fwd PE 12.46
P/S 3.88
P/FCF 30.02
P/OCF 27.89
P/B 2.54
P/tB 2.71
EV/EBITDA 14.87
EPS(TTM)0.54
EY5.45%
EPS(NY)0.8
Fwd EY8.03%
FCF(TTM)0.33
FCFY3.33%
OCF(TTM)0.36
OCFY3.59%
SpS2.56
BVpS3.9
TBVpS3.66
PEG (NY)0.39
PEG (5Y)11.83
Graham Number6.89
Profitability
Industry RankSector 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 RankSector 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 14.84
F-Score6
WACC10.23%
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.


Can you provide the valuation status for ENERGY RECOVERY INC?

ChartMill assigns a valuation rating of 6 / 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 18.35 and the Price/Book (PB) ratio is 2.54.


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 47.33% in the next year.