# Energy Recovery Inc. (ERII) fundamentals

Data as of 2026-09-08. NASDAQ, United States. Sector: Industrials / Construction & Engineering. Price $7.63, market value $389 million.

## Valuation
- **P/E (trailing): 29.3×** (5-yr avg 51.6×, 3-yr avg 39.9×). Energy Recovery Inc. trades at 29.3× trailing earnings, well below its own five-year average of 51.6×: cheap by its own standards. The Industrials median in the September 2026 study was 25.7×. Forward P/E is 15.7×, lower than trailing, so analysts expect earnings to grow.
- **PEG: 3.15**. A PEG of 3.15 means the P/E is high relative to expected earnings growth; the price already assumes a lot.
- **Price / sales: 3.2×**. Each dollar of revenue is priced at 3.2×.
- **Price / book: 2.3×**. The shares trade at 2.3× book value; book value is a meaningful part of the valuation.
- **EV / EBITDA: 18.9×**. Enterprise value is 18.9× operating earnings before depreciation, the multiple that ignores how the company is financed.
- **Free-cash-flow yield: 9.9%** (5-yr avg 1.6%). Free cash flow equals 9.9% of the market value, above its five-year average of 1.6%, so the shares are cheaper on cash than they have usually been. Above 5% is generally attractive.
- **Earnings yield: 3.4%**. The inverse of the P/E: 3.4% of the price is earned each year.

## Profitability
- **Gross margin: 64.0%**. Energy Recovery Inc. keeps 64.0% of revenue after the direct cost of what it sells, the kind of margin that comes with software, brands or pricing power.
- **Operating margin: 11.8%**. 11.8% of revenue is left after running the business.
- **Net margin: 17.0%**. 17.0% of each dollar of sales reaches the bottom line.
- **Return on equity: 11.1%**. 11.1% on shareholders' equity is solid.
- **Return on invested capital: 7.1%**. Return on all capital, debt included, is 7.1%.
- **Return on assets: 6.6%**. Each dollar of assets produces 6.6% of profit.

## Growth
- **Revenue growth (1 yr): -6.9%** (3-yr 2.4%/yr, 5-yr 2.6%/yr). Revenue fell 6.9% over the last year, against 2.6% a year compounded over five years: growth is slowing.
- **EPS growth (1 yr): 5.0%** (3-yr 0.0%/yr, 5-yr -2.2%/yr). Earnings per share rose 5.0%, faster than revenue, so margins expanded or the share count shrank.
- **Free-cash-flow growth (3 yr): 27.6%/yr**. Free cash flow has compounded at 27.6% a year over three years, keeping pace with earnings: the growth is real cash.

## Financial health
- **Debt to equity: 0.00**. Debt is 0.00 times equity: a conservative balance sheet.
- **Net debt / EBITDA: net cash**. Energy Recovery Inc. holds more cash than debt.
- **Current ratio: 10.44** (quick 10.44). Current assets cover the next year's liabilities 10.44 times.
- **Altman Z-score: 12.25**. A Z-score of 12.25 places the company in the safe zone for bankruptcy risk.
- **Piotroski F-score: 6/9**. 6 of 9 checks pass: mixed.

## Dividends
- **Dividend: none**. Energy Recovery Inc. does not currently pay a dividend.

## Price and momentum
- **Total return (1 yr): -46.7%** (YTD -43.4%, 3-mo -4.7%). The shares are down 46.7% over twelve months including dividends.
- **From 52-week high: -58.4%** (1.6% above the low). Trading 58% below its 52-week high, deep in a drawdown.
- **200-day average: below**. The price sits below its 200-day moving average, the usual definition of a downtrend.
- **RSI (14-day): 39**. An RSI of 39 is neutral.
- **Beta (1 yr): 1.54** (volatility 57%). Beta of 1.54 against the S&P 500: the shares move much more than the market.

Live score and charts: https://foliofundamentals.com/analyzer?s=ERII · Page: https://foliofundamentals.com/stocks/erii

Not investment advice.