Latest news with #ERII
Yahoo
3 days ago
- Business
- Yahoo
What Is Energy Recovery, Inc.'s (NASDAQ:ERII) Share Price Doing?
While Energy Recovery, Inc. (NASDAQ:ERII) might not have the largest market cap around , it saw a double-digit share price rise of over 10% in the past couple of months on the NASDAQGS. The recent rally in share prices has nudged the company in the right direction, though it still falls short of its yearly peak. As a small cap stock, which tends to lack high analyst coverage, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Today we will analyse the most recent data on Energy Recovery's outlook and valuation to see if the opportunity still exists. We've found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free. Energy Recovery appears to be expensive according to our price multiple model, which makes a comparison between the company's price-to-earnings ratio and the industry average. We've used the price-to-earnings ratio in this instance because there's not enough visibility to forecast its cash flows. The stock's ratio of 32.25x is currently well-above the industry average of 23.27x, meaning that it is trading at a more expensive price relative to its peers. If you like the stock, you may want to keep an eye out for a potential price decline in the future. Given that Energy Recovery's share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility. View our latest analysis for Energy Recovery Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let's also take a look at the company's future expectations. With profit expected to grow by 35% over the next year, the near-term future seems bright for Energy Recovery. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation. Are you a shareholder? It seems like the market has well and truly priced in ERII's positive outlook, with shares trading above industry price multiples. However, this brings up another question – is now the right time to sell? If you believe ERII should trade below its current price, selling high and buying it back up again when its price falls towards the industry PE ratio can be profitable. But before you make this decision, take a look at whether its fundamentals have changed. Are you a potential investor? If you've been keeping an eye on ERII for a while, now may not be the best time to enter into the stock. The price has surpassed its industry peers, which means it is likely that there is no more upside from mispricing. However, the positive outlook is encouraging for ERII, which means it's worth diving deeper into other factors in order to take advantage of the next price drop. Diving deeper into the forecasts for Energy Recovery mentioned earlier will help you understand how analysts view the stock going forward. So feel free to check out our free graph representing analyst forecasts. If you are no longer interested in Energy Recovery, you can use our free platform to see our list of over 50 other stocks with a high growth potential. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Yahoo
30-04-2025
- Business
- Yahoo
Here's Why Energy Recovery (ERII) Recovered in Q1
Conestoga Capital Advisors, an asset management company, released its first-quarter 2025 investor letter. A copy of the letter can be downloaded here. Equity markets started the year with a rally due to optimism about a strong economy and expectations of moderating inflation and lower interest rates. However, concerns over slowing earnings from major Technology companies, geopolitical tensions, and an upcoming announcement on tariffs led to a sharp decline in equities by the end of the first quarter. Investors sought safety, driving U.S. Treasury yields down. The Conestoga Small Cap Composite returned -11.35% (net) in the first quarter compared to the Russell 2000 Growth Index's -11.12% return. The Conestoga SMid Cap Composite returned -5.73% compared to the Russell 2500 Growth Index's -10.80% return. The Conestoga Micro-Cap Composite returned -8.24% vs the Russell Microcap Growth Index's return of -17.75%. Finally, the Conestoga Mid Cap Composite returned 0.96% (net), compared to the Russell Midcap Growth Index's -7.12% return. Please check the top 5 holdings of the fund for a better understanding of their best picks for 2025. In its first-quarter 2025 investor letter, Conestoga Capital Advisors highlighted stocks such as Energy Recovery, Inc. (NASDAQ:ERII). Energy Recovery, Inc. (NASDAQ:ERII) develops, manufactures, and distributes energy efficiency technology solutions. The one-month return of Energy Recovery, Inc. (NASDAQ:ERII) was -2.84%, and its shares gained 5.12% of their value over the last 52 weeks. On April 29, 2025, Energy Recovery, Inc. (NASDAQ:ERII) stock closed at $15.40 per share, with a market capitalization of $843.244 million. Conestoga Capital Advisors stated the following regarding Energy Recovery, Inc. (NASDAQ:ERII) in its Q1 2025 investor letter: "Energy Recovery, Inc. (NASDAQ:ERII) is a global leader in energy efficiency technology through its proprietary pressure exchanger technology. After announcing its strategic roadmap in November and setting expectations for new products to ramp over a longer period, the stock recovered in the first quarter. ERII announced strong fourth quarter results, with profitability notably outperforming expectations on the back of strong gross margin expansion. Guidance for 2025 was reiterated. ERII also announced an additional $30 million stock buyback program." A treatment plant with a large industrial wastewater treatment pipe in the foreground. Energy Recovery, Inc. (NASDAQ:ERII) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 15 hedge fund portfolios held Energy Recovery, Inc. (NASDAQ:ERII) at the end of the fourth quarter, compared to 12 in the third quarter. While we acknowledge the potential of Energy Recovery, Inc. (NASDAQ:ERII) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. In another article, we covered Energy Recovery, Inc. (NASDAQ:ERII) and shared Conestoga Capital Advisors' views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Yahoo
28-04-2025
- Business
- Yahoo
2 Reasons to Like ERII (and 1 Not So Much)
Over the past six months, Energy Recovery's shares (currently trading at $15.02) have posted a disappointing 16.5% loss while the S&P 500 was down 5.3%. This may have investors wondering how to approach the situation. Given the weaker price action, is now an opportune time to buy ERII? Find out in our full research report, it's free. Having saved far more than a trillion gallons of water, Energy Recovery (NASDAQ:ERII) provides energy recovery devices to the water treatment, oil and gas, and chemical processing sectors. Reviewing a company's long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years. Over the last five years, Energy Recovery grew its sales at an impressive 10.8% compounded annual growth rate. Its growth surpassed the average industrials company and shows its offerings resonate with customers. We track the long-term change in earnings per share (EPS) because it highlights whether a company's growth is profitable. Energy Recovery's EPS grew at an astounding 39.8% compounded annual growth rate over the last five years, higher than its 10.8% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded. A company's ROIC, or return on invested capital, shows how much operating profit it makes compared to the money it has raised (debt and equity). We like to invest in businesses with high returns, but the trend in a company's ROIC is what often surprises the market and moves the stock price. Over the last few years, Energy Recovery's ROIC has unfortunately decreased significantly. Only time will tell if its new bets can bear fruit and potentially reverse the trend. Energy Recovery's merits more than compensate for its flaws. With the recent decline, the stock trades at 22× forward price-to-earnings (or $15.02 per share). Is now the time to initiate a position? See for yourself in our full research report, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 175% over the last five years. Stocks that made our list in 2019 include now familiar names such as Nvidia (+2,183% between December 2019 and December 2024) as well as under-the-radar businesses like Sterling Infrastructure (+1,096% five-year return). Find your next big winner with StockStory today for free. Sign in to access your portfolio
Yahoo
27-02-2025
- Business
- Yahoo
Energy Recovery Inc (ERII) Q4 2024 Earnings Call Highlights: Strong Financial Performance and ...
Release Date: February 26, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Energy Recovery Inc (NASDAQ:ERII) reported strong fourth-quarter results, indicating robust financial performance. The company is seeing increased interest in its PX technology from new markets such as Japan and South Africa, suggesting potential for geographic expansion. Manufacturing transformation efforts are yielding efficiency improvements, which are expected to drive margin growth in 2025. Energy Recovery Inc (NASDAQ:ERII) has initiated an additional $30 million share buyback, reflecting confidence in its financial stability and future prospects. The company has a diversified revenue stream with significant contributions from the Middle East and North Africa, reducing dependency on any single market. There is potential risk from tariffs impacting the wastewater business, particularly in China, which could affect sales and ROI for customers. The company's revenue from desalination projects is highly project-driven, which can lead to unpredictability in financial performance. Despite strong results, the company faces challenges in scaling its manufacturing processes efficiently as it grows. The impact of trade issues remains a concern, with potential negative effects on the company's export business. Energy Recovery Inc (NASDAQ:ERII) must continue to navigate competitive pressures and market dynamics in its core and emerging markets. Warning! GuruFocus has detected 4 Warning Signs with ERII. Q: You mentioned a case study on how the PX reduced costs at a nanofiltration-based lithium extraction facility in China. What other commercial applications might this result validate? A: David Moon, President and CEO, explained that the PX technology could potentially be applied to four other verticals: mining applications, heavy manufacturing, chemical manufacturing, and textile manufacturing. These sectors involve large solids streaming through the system, making the product applicable. Q: Can you elaborate on the specific drivers of growth margin improvement you expect in 2025? A: Michael Mancini, CFO, highlighted that the key drivers are efficiency improvements in the manufacturing process. The company is optimizing every step, from stacking kilns to cycle times and pressing bullets with iso presses. This manufacturing transformation plan is expected to continuously improve costs throughout the year. Q: You mentioned increased activity from customers outside of core focus areas. Can you elaborate on these areas and how they learned about the PXG? A: David Moon noted interest from Japan and South Africa. In Japan, an OEM learned about the company through trade shows, leading to test sites and a first official order. In South Africa, a large supermarket chain called Macro learned about the technology through a consultant, and they are working on setting up a test site. Q: Regarding the additional $30 million buyback, was it due to early progress on costs and desal visibility for 2025? A: Michael Mancini confirmed that visibility on cash flow and the quick completion of the initial $50 million buyback gave them confidence to increase it. The company is committed to returning excess cash and aligning with their capital allocation strategy. Q: What are your expectations for the geographic breakdown of desal revenue in 2025? A: Michael Mancini expects the geographic breakdown to be similar to 2024, with over 60% of business coming from the Middle East and North Africa. The mix is project-driven, and they anticipate a generally similar distribution. Q: How might tariffs impact the wastewater business, and is there upside without trade issues? A: Michael Mancini explained that the guidance was given without known tariffs. If tariffs affect the effective price of PX products in China, it could impact sales. Currently, about 5% of the wastewater business comes from China, and any trade war impact could affect ROI for customers. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Sign in to access your portfolio
