ERII Industrials

Energy Recovery, Inc.

$7.17-0.14%

Price as of close on Nov 3, 2026 · Financials updated Oct 8, 2026

Basics

Sector: Industrials
Industry: Pollution & Treatment Controls
Country: United States
Market cap: 366.0M USD
Enterprise value: 281.2M USD
Full-time employees: 230

Overall health

Strength: its shares are priced lower than most peers relative to what it earnspriced lower than peers for its earnings
Drawback: growing more slowly than most peersgrowing more slowly than peers
Drawback: its share price swings more than most peers’ (beta 0.91 vs a peer median of 0.64), though less than the overall marketbigger price swings (beta 0.91 vs peers 0.64)

Ranks #622 of 2,308 industrials companies (top 27%)

See how it ranks against its peers

Worth knowing

Returning more cash than it generates. Paid out $86M vs $60M of free cash flow over the 3 fiscal years to 2025.
Energy Recovery returned $86M to shareholders over three years, 143% of the free cash flow it produced. That gap has to be covered by cash reserves or new debt, which can't last indefinitely.
Share count shrinking. Shares outstanding down 9.0% from December 2022 to July 2026.
Energy Recovery had 9.0% fewer shares at July 2026 than at December 2022, mainly through buybacks, so each remaining share owns a larger slice of the business.
Profitable, but revenue is shrinking. More profitable than most peers, but revenue fell 15% in the 12 months to June 2026 vs the 12 months before.
Energy Recovery is more profitable than most peers, yet revenue fell 15% in the 12 months to June 2026 vs the 12 months before.
Cash flow well above reported profit. Free cash flow is 2.5× reported profit.
Free cash flow is 2.5× reported profit. Large non-cash charges, such as depreciation, amortization or stock-based pay, reduce reported profit without using cash.

StockQuotient Score

62/ 100▼ 1 since Oct 27 close

Oct 5 63 → Nov 4 62 (-1)

Valuation

Is the price right?

63/100

Moderate▼ 3 since Oct 27 close

3/3 inputs reported · High confidence

Since last quarter: No major changeValuation also moves with the share price every day.

Why it changed since the Oct 27, 2026 close: Score 66 → 63

Share price +4.5%-2
Peer companies moved-1

Each step re-scores the company against its peers as they were on Oct 28, 2026; the parts add up to the change. Price effects on EBITDA yield are approximate.

Why

Stronger than most peers on:

▲ FCF yield

Compare with peers

Behind the score

Sector-normalized EBITDA, earnings, and free cash flow yields.

Earnings yield4.2%

SEC filings · 12 months to Jun 2026Reported value30% base weight · Z-score 0.14Sector median: 0.0377 · MAD: 0.0294

EBITDA yield8.4%

Yahoo Finance fallback · SEC enterprise value unavailable (debt or EBITDA not reported in standard form) · trailing 12 monthsReported value50% base weight · Z-score 0.33Sector median: 0.0695 · MAD: 0.0425

Free cash flow yield10.5%

SEC filings · 12 months to Jun 2026 · operating cash flow − capital spendingReported value20% base weight · Z-score 1.85Sector median: 0.0370 · MAD: 0.0370

Other data (not scored)

Book yield47.1%

SEC filings · latest balance sheetReported valueInformational · 0% composite weightSector median: 0.5027 · MAD: 0.2823

Growth

Is it growing?

17/100

Weak

3/3 inputs reported · High confidence

Since last quarter: ▼ Weaker

12-month revenue fell 11.8%

Why

Weaker than most peers on:

▼ Revenue growth
▼ EPS growth

Compare with peers

Behind the score

Revenue and earnings-per-share growth over one year, and revenue growth over three years.

Earnings per share growth-33.7%

SEC filings · 12 months to Jun 2026Reported value33% base weight · Z-score -1.65Sector median: 0.0709 · MAD: 0.2481

3-year revenue growth4.1%

SEC filings · 3 years to Jun 2026Reported value33% base weight · Z-score -0.02Sector median: 0.0421 · MAD: 0.0625

Revenue growth-15.0%

SEC filings · 12 months to Jun 2026Reported value33% base weight · Z-score -2.53Sector median: 0.0439 · MAD: 0.0766

Profitability

Does it earn well?

73/100

Moderate

3/3 inputs reported · High confidence

Since last quarter: ▼ Weaker

Operating margin fell 4.0 points to 11.8%

Why

Stronger than most peers on:

▲ ROA
▲ Operating margin
▲ ROIC

Compare with peers

Behind the score

Return on invested capital, operating margin, and return on assets.

Operating margin11.8%

SEC filings · 12 months to Jun 2026Reported value33% base weight · Z-score 0.80Sector median: 0.0773 · MAD: 0.0507

Return on assets7.8%

SEC filings · 12 months to Jun 2026Reported value33% base weight · Z-score 1.93Sector median: 0.0311 · MAD: 0.0241

Return on invested capital10.1%

SEC filings · 12 months to Jun 2026Reported value33% base weight · Z-score 0.53Sector median: 0.0715 · MAD: 0.0558

Other data (not scored)

Gross margin64.0%

SEC filings · 12 months to Jun 2026Outlier capped at sector 5th/95th percentileInformational · 0% composite weightSector median: 0.2573 · MAD: 0.1038

Return on equity8.9%

SEC filings · 12 months to Jun 2026Reported valueInformational · 0% composite weightSector median: 0.0802 · MAD: 0.0639

Risk

Debt, liquidity, price swings

Lower

Lower relative risk

3/3 inputs reported · High confidence

Since last quarter: No major change

Why

Stronger than most peers on:

▲ Current ratio
▲ Debt / equity

Compare with peers

Behind the score

Relative to sector peers: 0 = lower relative risk · 1 = moderate · 2 = higher. Based on leverage, beta and liquidity.

Beta0.91

Yahoo Finance · 5-year monthly beta vs the marketReported value33% base weight · Z-score -0.97Sector median: 0.6440 · MAD: 0.2745

Current ratio8.05×

SEC filings · latest balance sheetOutlier capped at sector 5th/95th percentile33% base weight · Z-score 6.75Sector median: 1.6180 · MAD: 0.5360

Debt / equity0.05×

Yahoo Finance fallback · no standard SEC debt tagReported value33% base weight · Z-score 1.05Sector median: 0.4019 · MAD: 0.3378

Valuation, growth and profitability scores: higher is better. Risk: 0 is lower, 2 is higher. Risk is a relative proxy, not a bankruptcy probability. Scores depend on available sector peers.

Questions investors ask about Energy Recovery

Is Energy Recovery getting weaker?: Its latest SEC filing (Aug 5, 2026) got weaker in some ways: operating margin fell 4.0 points to 11.8%; 12-month revenue fell 11.8%. Its overall score is 62/100, down 1 since Oct 28, 2026.
How is Energy Recovery valued vs its peers?: Priced lower than most peers relative to what it earns. Valuation scores 63/100 against 2,459 industrials peers. Free cash flow yield 10.5% vs a peer median of 3.7% (stronger than 83% of peers).Free cash flow yield 10.5% vs peers 3.7% (stronger than 83% of peers).
Is Energy Recovery growing?: More slowly than most of its peers. Growth scores 17/100 against 2,459 industrials peers. Revenue growth -15.0% vs a peer median of 4.4% (weaker than 90% of peers).Revenue growth -15.0% vs peers 4.4% (weaker than 90% of peers).
How profitable is Energy Recovery?: More profitable than most of its peers. Profitability scores 73/100 against 2,459 industrials peers. Return on assets 7.8% vs a peer median of 3.1% (stronger than 87% of peers).Return on assets 7.8% vs peers 3.1% (stronger than 87% of peers).
How risky is Energy Recovery?: Lower risk relative to 2,459 industrials peers, judged on debt, liquidity and share-price swings. Current ratio 8.05× vs a peer median of 1.62× (stronger than 95% of peers).Current ratio 8.05× vs peers 1.62× (stronger than 95% of peers). Beta 0.91 vs a peer median of 0.64 (weaker than 69% of peers).Beta 0.91 vs peers 0.64 (weaker than 69% of peers). A relative measure, not a bankruptcy probability.

Latest filing: what changed

Quarter ended Jun 30, 2026 · filed Aug 5, 2026 · compared with the quarter ended Mar 31, 2026

Got weaker

Operating margin fell 4.0 points to 11.8%
12-month revenue fell 11.8%

	Previous quarter	Latest quarter	Change
Revenue (12 months)	136.6M USD	120.6M USD	−11.8%
Net income (12 months)	20.6M USD	15.3M USD	−25.5%
Operating margin	15.8%	11.8%	−4.0 pts
Free cash flow (12 months)	27.2M USD	38.6M USD	+42.0%
Cash	50.1M USD	61.4M USD	+22.6%
Shares outstanding	51.5M	51.0M	−1.0%

From the company’s own SEC filings, as filed. Twelve-month figures roll forward one quarter at a time.

Industry valuation context

Sector: Industrials · 318 companies

Valuations in Industrials are near the top of their range since 2016.

85% of months since 2016 were valued lower than now.
41% of companies are in the most expensive fifth of their own price-to-sales history.
Over 24 months, company values +20% and earnings +14% (medians): prices and earnings moved broadly together.
Median price-to-sales is −24% vs the whole market, against a usual −31%.

2016Shaded: most expensive fifth of its range2026

Shown for Industrials: too few Pollution & Treatment Controls companies have a long enough history of their own.

Financials

Fiscal years from SEC annual filings · change vs the prior year

Key ratios	FY 2021	FY 2022	FY 2023	FY 2024	FY 2025	Change
Gross margin	68.6%	69.6%	67.8%	66.9%	65.1%	▼ 1.7 pts
Operating margin	13.3%	19.8%	14.8%	13.6%	17.7%	▲ 4.1 pts
Net margin	13.7%	19.1%	16.8%	15.9%	17.0%	▲ 1.1 pts
Return on assets (ROA)	6.7%	11.1%	8.5%	9.5%	9.9%	▲ 0.4 pts
Return on equity (ROE)	8.0%	13.0%	9.8%	11.0%	11.1%	▲ 0.2 pts
Free cash flow margin	6.6%	6.7%	18.3%	13.3%	12.9%	▼ 0.3 pts
Current ratio	7.67×	8.63×	8.64×	7.41×	10.44×	▲ 41%
Quick ratio	6.64×	7.08×	7.42×	6.35×	9.04×	▲ 42%

ERII price history

Price history is added with the daily price update and will appear after the next one.

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Bringing the fundamentals into focus…

Overall health

Strength: its shares are priced lower than most peers relative to what it earnspriced lower than peers for its earnings

Drawback: growing more slowly than most peersgrowing more slowly than peers

Drawback: its share price swings more than most peers’ (beta 0.91 vs a peer median of 0.64), though less than the overall marketbigger price swings (beta 0.91 vs peers 0.64)

Ranks #622 of 2,308 industrials companies (top 27%)

See how it ranks against its peers

Worth knowing

Returning more cash than it generates. Paid out $86M vs $60M of free cash flow over the 3 fiscal years to 2025.

Energy Recovery returned $86M to shareholders over three years, 143% of the free cash flow it produced. That gap has to be covered by cash reserves or new debt, which can't last indefinitely.

Share count shrinking. Shares outstanding down 9.0% from December 2022 to July 2026.

Energy Recovery had 9.0% fewer shares at July 2026 than at December 2022, mainly through buybacks, so each remaining share owns a larger slice of the business.

Profitable, but revenue is shrinking. More profitable than most peers, but revenue fell 15% in the 12 months to June 2026 vs the 12 months before.

Energy Recovery is more profitable than most peers, yet revenue fell 15% in the 12 months to June 2026 vs the 12 months before.

Cash flow well above reported profit. Free cash flow is 2.5× reported profit.

Free cash flow is 2.5× reported profit. Large non-cash charges, such as depreciation, amortization or stock-based pay, reduce reported profit without using cash.

Questions investors ask about Energy Recovery

Is Energy Recovery getting weaker?

Its latest SEC filing (Aug 5, 2026) got weaker in some ways: operating margin fell 4.0 points to 11.8%; 12-month revenue fell 11.8%. Its overall score is 62/100, down 1 since Oct 28, 2026.

How is Energy Recovery valued vs its peers?

Priced lower than most peers relative to what it earns. Valuation scores 63/100 against 2,459 industrials peers. Free cash flow yield 10.5% vs a peer median of 3.7% (stronger than 83% of peers).Free cash flow yield 10.5% vs peers 3.7% (stronger than 83% of peers).

Is Energy Recovery growing?

More slowly than most of its peers. Growth scores 17/100 against 2,459 industrials peers. Revenue growth -15.0% vs a peer median of 4.4% (weaker than 90% of peers).Revenue growth -15.0% vs peers 4.4% (weaker than 90% of peers).

How profitable is Energy Recovery?

More profitable than most of its peers. Profitability scores 73/100 against 2,459 industrials peers. Return on assets 7.8% vs a peer median of 3.1% (stronger than 87% of peers).Return on assets 7.8% vs peers 3.1% (stronger than 87% of peers).

How risky is Energy Recovery?

Lower risk relative to 2,459 industrials peers, judged on debt, liquidity and share-price swings. Current ratio 8.05× vs a peer median of 1.62× (stronger than 95% of peers).Current ratio 8.05× vs peers 1.62× (stronger than 95% of peers). Beta 0.91 vs a peer median of 0.64 (weaker than 69% of peers).Beta 0.91 vs peers 0.64 (weaker than 69% of peers). A relative measure, not a bankruptcy probability.

Previous quarter

Latest quarter

Change

Revenue (12 months)

136.6M USD

120.6M USD

−11.8%

Net income (12 months)

20.6M USD

15.3M USD

−25.5%

Operating margin

15.8%

11.8%

−4.0 pts

Free cash flow (12 months)

27.2M USD

38.6M USD

+42.0%

Cash

50.1M USD

61.4M USD

+22.6%

Shares outstanding

51.5M

51.0M

−1.0%

Key ratios

FY 2021

FY 2022

FY 2023

FY 2024

FY 2025

Change

Gross margin

68.6%

69.6%

67.8%

66.9%

65.1%

▼ 1.7 pts

Operating margin

13.3%

19.8%

14.8%

13.6%

17.7%

▲ 4.1 pts

Net margin

13.7%

19.1%

16.8%

15.9%

17.0%

▲ 1.1 pts

Return on assets (ROA)

6.7%

11.1%

8.5%

9.5%

9.9%

▲ 0.4 pts

Return on equity (ROE)

8.0%

13.0%

9.8%

11.0%

11.1%

▲ 0.2 pts

Free cash flow margin

6.6%

6.7%

18.3%

13.3%

12.9%

▼ 0.3 pts

Current ratio

7.67×

8.63×

8.64×

7.41×

10.44×

▲ 41%

Quick ratio

6.64×

7.08×

7.42×

6.35×

9.04×

▲ 42%