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Energy Recovery (ERII) Stock Fundamentals, Analysis & Risk Signals

Health score, price, valuation, risk signals, and key metrics at a glance.

Energy Recovery
NasdaqGS•Industrials•Pollution & Treatment Controls
$7.55+0.28(0.04%)Pre-market
Market Cap
$363.33M
P/E
23.7x
P/S
3.0x
P/B
2.1x

Energy Recovery, Inc., together with its subsidiaries, designs, manufactures, and sells energy efficiency technology solutions in the United States, North, South and Latin America, the Middle East, Northern Africa, Asia, and Europe. It operates through Water and Emerging Technologies segments. The company offers high and low pressure, and ultra high-pressure exchangers; AT and LPT hydraulic turbochargers; and high-pressure feed and circulation pumps for use in water treatment industries, including seawater and brackish desalination, and wastewater treatment. It also provides PX G1300, which reduces energy consumption and operating costs of carbon dioxide-based refrigeration systems; and spare parts, as well as repair, field, and commissioning services. The company sells its products under the ERI, PX, PX Pressure Exchanger, Pressure Exchanger, Ultra High-Pressure PX, PX G1300, PX PowerTrain, PX G, AT, and Aquabold brands to supermarket chains, cold storage facilities, refrigeration system installers or OEMs, and other industrial users; and aftermarket customers consisting of desalination plant owners and operators. Energy Recovery, Inc. was incorporated in 1992 and is headquartered in San Leandro, California.

C

How this company scores

AverageMetricSide Score: 47/100

Strongest: Balance Sheet & Red Flags (15/25); weakest: Growth (4/25).

Profitability13/25
Growth4/25
Balance Sheet & Red Flags15/25
Cash & Earnings Quality15/25
Strengths
Rising free cash flowInterest easily coveredNet cash positionImproving margins

Valuation vs. 5-year range

Today's multiple positioned against its own trailing range — a visual premium/discount check.

P/E · 23.7x5y range 23.7x – 148.5x
P/E 23.7x · below its 20-quarter median

Currently below its 20-quarter median.

P/S · 3.0x5y range 3.0x – 14.7x
P/S 3.0x · below its 20-quarter median

Currently below its 20-quarter median.

P/B · 2.1x5y range 2.1x – 8.6x

Watch items

Data-driven signals worth keeping an eye on across the last 8 quarters

High Risk

Margin Pressure

Red Flag

The company posted negative operating margins in recent quarters — core operations are unprofitable.

Earnings Quality

Red Flag

FCF consistently trails net income (avg -0.8x) — earnings may be inflated by non-cash items or aggressive accounting.

Price & Volume
Market Cap $363.33M

Metrics at a Glance

as of June 2026

Revenue & Profit

Revenue, EBITDA, operating income, net income, EPS, and shares

TTM Revenue
$120.57M
15%
Q. Revenue
$12.00M
57%
TTM EBITDA
$18.07M
2Q
TTM Op. Income
$14.23M
2Q
Q. Op. Income
$-5.88M
499%
TTM Net Income
$15.34M
2Q
Q. Net Income
$-3.20M
256%
EPS
$-0.06
250%
Shares Out.
$51.46M
7Q
$120.57M in TTM revenue declined 15.0% YoY, reaching $12.00M last quarter. TTM EBITDA of $18.07M and TTM operating income of $14.23M show growth is flowing through to the bottom line. TTM net income of $15.34M means revenue is converting into profit. Over the past year, TTM revenue is down 15% — a weakening trend.

Margins

Gross, EBITDA, operating, and net margin trends

Gross Margin
74.7%
17%
EBITDA Margin
-40.7%
572%
Op. Margin
-49.0%
1033%
Net Margin
-26.7%
464%
Op. margin of -49.0% is down 54.3% YoY — costs are rising relative to revenue. Net margin at -26.7% and gross margin of 74.7% show how much of each revenue dollar survives to profit. Over the past year, operating margin is down 1033% — an improving trend.

Price Ratios

P/E, P/S, P/B, EV/EBITDA, FCF yield, and earnings yield

P/E Ratio
23.7x
3Q
P/S Ratio
3.0x
3Q
P/B Ratio
2.1x
3Q
At 23.7x P/E, the stock trades within typical market levels. P/S of 3.0x and P/B of 2.1x provide additional context. Use the growth and margin sections to judge whether the multiple is justified. Across the last 8 quarters, P/E has fallen for 3 consecutive quarters — an improving trend.

Assets & Liabilities

Total assets, cash, debt, book value, and leverage

Total Assets
$197.74M
2Q
Cash
$61.44M
3Q
Long-Term Debt
N/A
Book Value
$172.48M
2Q
D/E Ratio
N/A
Debt/EBITDA
N/A

Cash Flow

Operating cash flow, free cash flow, FCF margin, and earnings quality

Op. Cash Flow
$16.31M
293%
TTM Free Cash Flow
$38.60M
2Q
FCF Margin
32.0%
2Q
FCF / Net Income
2.5
2Q
TTM FCF of $38.60M on $16.31M in operating cash flow. The FCF / Net Income ratio of 2.5x means free cash flow covers net income — earnings are backed by cash. Across the last 8 quarters, free cash flow has risen for 2 consecutive quarters — an improving trend.

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· below its 20-quarter median

Currently below its 20-quarter median.

Revenue Decline

Watch

Revenue has softened, declining in 4 quarters. Watch for further erosion.

Cash Burn

Watch

FCF turned negative in 2 of the last 8 quarters — occasional cash consumption.