NasdaqGS:ERII

Stock Analysis Report

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Executive Summary

Energy Recovery, Inc., together with its subsidiaries, designs, manufactures, and markets various solutions for industrial fluid flow markets worldwide. More Details


Snowflake Analysis

Flawless balance sheet with proven track record.


Similar Companies

Share Price & News

How has Energy Recovery's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ERII has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

2.9%

ERII

-0.08%

US Machinery

-1.4%

US Market


1 Year Return

-2.1%

ERII

13.7%

US Machinery

17.8%

US Market

Return vs Industry: ERII underperformed the US Machinery industry which returned 13.7% over the past year.

Return vs Market: ERII underperformed the US Market which returned 18.5% over the past year.


Shareholder returns

ERIIIndustryMarket
7 Day2.9%-0.08%-1.4%
30 Day17.4%8.1%4.7%
90 Day22.6%13.7%8.2%
1 Year-2.1%-2.1%16.7%13.7%20.5%17.8%
3 Year15.5%15.5%24.1%15.1%42.2%32.7%
5 Year35.1%35.1%105.7%82.7%83.4%62.7%

Price Volatility Vs. Market

How volatile is Energy Recovery's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Energy Recovery undervalued compared to its fair value and its price relative to the market?

23.63x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ERII ($9.44) is trading above our estimate of fair value ($6.22)

Significantly Below Fair Value: ERII is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ERII is good value based on its PE Ratio (23.6x) compared to the US Machinery industry average (25.7x).

PE vs Market: ERII is poor value based on its PE Ratio (23.6x) compared to the US market (19x).


Price to Earnings Growth Ratio

PEG Ratio: ERII's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: ERII is overvalued based on its PB Ratio (3.3x) compared to the US Machinery industry average (2.4x).


Next Steps

Future Growth

How is Energy Recovery forecast to perform in the next 1 to 3 years based on estimates from 4 analysts?

-26.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ERII's earnings are forecast to decline over the next 3 years (-26.8% per year).

Earnings vs Market: ERII's earnings are forecast to decline over the next 3 years (-26.8% per year).

High Growth Earnings: ERII's earnings are forecast to decline over the next 3 years.

Revenue vs Market: ERII's revenue is expected to decline over the next 3 years (-2.8% per year).

High Growth Revenue: ERII's revenue is forecast to decline over the next 3 years (-2.8% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ERII's Return on Equity is forecast to be low in 3 years time (7.5%).


Next Steps

Past Performance

How has Energy Recovery performed over the past 5 years?

53.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ERII has a high level of non-cash earnings.

Growing Profit Margin: ERII's current net profit margins (20.2%) are higher than last year (16.3%).


Past Earnings Growth Analysis

Earnings Trend: ERII has become profitable over the past 5 years, growing earnings by 53.2% per year.

Accelerating Growth: ERII's earnings growth over the past year (64.2%) exceeds its 5-year average (53.2% per year).

Earnings vs Industry: ERII earnings growth over the past year (64.2%) exceeded the Machinery industry -13.1%.


Return on Equity

High ROE: ERII's Return on Equity (14%) is considered low.


Next Steps

Financial Health

How is Energy Recovery's financial position?


Financial Position Analysis

Short Term Liabilities: ERII's short term assets ($119.1M) exceed its short term liabilities ($10.8M).

Long Term Liabilities: ERII's short term assets ($119.1M) exceed its long term liabilities ($17.7M).


Debt to Equity History and Analysis

Debt Level: ERII is debt free.

Reducing Debt: ERII has no debt compared to 5 years ago when its debt to equity ratio was 0.09%.

Debt Coverage: ERII has no debt, therefore it does not need to be covered by operating cash flow.

Interest Coverage: ERII has no debt, therefore coverage of interest payments is not a concern.


Balance Sheet


Next Steps

Dividend

What is Energy Recovery current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate ERII's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate ERII's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ERII's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ERII's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ERII's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

1.8yrs

Average management tenure


CEO

Robert, Bob Mao (76 yo)

0.92

Tenure

US$569,542

Compensation

Mr. Yu-Lang Mao, also known as Robert & Bob, serves as the President & Chief Executive Officer of Energy Recovery, Inc. since May 5, 2020. He serves as an Advisor at PAC-LINK Management Corp. Mr. Mao serve ...


CEO Compensation Analysis

Compensation vs Market: Robert, Bob's total compensation ($USD569.54K) is below average for companies of similar size in the US market ($USD1.93M).

Compensation vs Earnings: Robert, Bob's compensation has increased by more than 20% in the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Yu-Lang Mao
President0.92yrUS$569.54k0.33%
$ 1.7m
Joshua Ballard
Chief Financial Officer2.17yrsUS$847.70k0.0013%
$ 6.6k
Farshad Ghasripoor
Chief Technology Officer2.92yrsUS$719.91k0.0094%
$ 49.4k
Rodney Clemente
Senior Vice President of Water0.75yrUS$784.56k0.0043%
$ 22.8k
Nocair Bensalah
Vice President of Operations5.75yrsUS$783.35k0%
$ 0
Emily Smith
Senior VP of Corporate Development & Operations0.75yrno data0.0038%
$ 20.2k
James Siccardi
Vice President of Investor Relationsno datano datano data
William Yeung
Chief Legal Officer4.33yrsno data0.037%
$ 196.4k
Stacy Proctor
Vice President of Human Resources1.75yrsno datano data
Brandon Young
Corporate Controller1.75yrsno datano data

1.8yrs

Average Tenure

48yo

Average Age

Experienced Management: ERII's management team is not considered experienced ( 1.8 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Yu-Lang Mao
President0.92yrUS$569.54k0.33%
$ 1.7m
Olav Fjell
Independent Director5.33yrsUS$135.00k0.032%
$ 169.9k
Arve Hanstveit
Independent Director25.17yrsUS$145.00k2.01%
$ 10.6m
Ole Lorentzen
Independent Director5.67yrsUS$140.00k0.79%
$ 4.2m
Alexander Buehler
Independent Director5.67yrsUS$150.00k0.11%
$ 566.4k
Sherif Foda
Independent Director4.08yrsUS$135.00k0%
$ 0
Pamela Tondreau
Lead Independent Director0.42yrUS$95.23k0%
$ 0

5.3yrs

Average Tenure

65yo

Average Age

Experienced Board: ERII's board of directors are considered experienced (5.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Energy Recovery, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Energy Recovery, Inc.
  • Ticker: ERII
  • Exchange: NasdaqGS
  • Founded: 1992
  • Industry: Industrial Machinery
  • Sector: Capital Goods
  • Market Cap: US$525.637m
  • Shares outstanding: 55.68m
  • Website: https://www.energyrecovery.com

Number of Employees


Location

  • Energy Recovery, Inc.
  • 1717 Doolittle Drive
  • San Leandro
  • California
  • 94577
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ERIINasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJul 2008
500DB (Deutsche Boerse AG)YesCommon StockDEEURJul 2008

Biography

Energy Recovery, Inc., together with its subsidiaries, designs, manufactures, and markets various solutions for industrial fluid flow markets worldwide. The company operates through Water, and Oil & Gas se ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/10/22 01:18
End of Day Share Price2020/10/21 00:00
Earnings2020/06/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.