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Upturn AI Summary - About
Energy Recovery Inc(ERII)
Advisory History & Simulated Performance *
*as per simulation (see disclosures)- ALL
- 1Y
- 1M
- 1W
- BUY Advisory
- SELL Advisory (Profit)
- SELL Advisory (Loss)
- Profit
- Loss
- PASS (Skip)
Stock price based on last close Advisory Performance History (Simulated)
Upturn Advisory & Investor View for ERII
11/06/2026: ERII (1-star) is currently NOT-A-BUY. Pass it for now.
Energy Recovery Inc is a specialty industrial company that provides high-efficiency pressure energy recovery devices, primarily for the global desalination and refrigeration industries. The company has a leading position in desalination, where its technology provides essential cost savings. Its growth story hinges on successfully expanding these proprietary solutions into new markets, such as commercial refrigeration. While the firm benefits from strong margins and secular demand for water security, it faces risks related to lumpy infrastructure project cycles and the execution of its diversification strategy. It is best suited for growth-oriented investors who can tolerate project-related volatility and monitor the adoption of new product lines.
How to Read the Upturn Advisory
The Upturn Star Rating and the current BUY, SELL, or PASS advisory are generated by Upturn’s AI advisory engine based on proprietary signal analysis, price behavior, advisory history, and historical signal performance.
Company fundamentals, valuation, risks, and news provide supporting context about the business.
Investor Fit
| Investor style | Fit | Why |
|---|---|---|
| Growth investor | Strong fit | The company targets high-growth segments in desalination and industrial efficiency. |
| Momentum investor | Mixed fit | Performance is often tied to long-term project cycles rather than short-term price momentum. |
| Value investor | Weak fit | The stock often trades at a premium multiple due to its specialized technology and growth potential. |
| Dividend investor | Weak fit | The company does not pay a dividend. |
| Low-risk investor | Weak fit | Project concentration risk and volatility make this unsuitable for low-risk portfolios. |
Risk Profile
| Risk factor | Level | Why it matters |
|---|---|---|
| Price volatility | Medium / high | The stock can be sensitive to project timing and macro infrastructure spending. |
| Valuation risk | Medium / high | Growth expectations are already priced into the stock, leaving little margin for error. |
| Competition risk (industrial fluid efficiency) | Medium | Established industrial players could attempt to erode market share via pricing or alternative tech. |
| Business quality | Strong | The company possesses a strong moat with its proprietary technology and high margins. |
| Dividend income | Low / none | The company is focused on growth and offers no income component. |
| Execution risk | Medium | Success depends on the successful adoption of new products like the G-Series in competitive markets. |
Price Behavior
Steep Decline
The stock price has dropped sharply with strong downward pressure.
Extreme Price Shocks
The stock has experienced exceptionally large and disruptive price movements during the period.
Analysis of Past Performance
Type Stock | Historic Profit -43.86% | Avg. Invested days 36 | Today’s Advisory PASS |
Upturn Advisory Rating  | Upturn Advisory Performance  3.0 | Stock Returns Performance  1.0 |
| Profits based on simulation | Last Close 11/06/2026 |
Upturn Scorecard
Upturn Star Rating 
Company Fundamentals
Financial Health Rating
Growth Momentum Score
Ownership
Top 5 Institutional Investors
Unit Economics (Per $1K Revenue)
Economic Dimensions
Quantitative Style Profile
Style Classification
Quality Focused
Key Highlights
Company Size Small-Cap Stock | Market Capitalization 362.96M USD | Price to earnings Ratio 102.14 | 1Y Target Price 8 |
Price to earnings Ratio 102.14 | 1Y Target Price 8 | ||
Volume (30-day avg) 862.2K shares | Beta 0.9 | 52 Weeks Range 6.25 - 16.30 | Updated Date 11/08/2026 |
52 Weeks Range 6.25 - 16.30 | Updated Date 11/08/2026 | ||
Dividends yield (FY) - | Basic EPS (TTM) 0.07 |
How Company Makes Money
| Business area | What it includes | Retail investor read |
|---|---|---|
| Water | PX Pressure Exchangers for desalination projects. | The bread and butter of the company, providing steady cash flow from global water projects. |
| Emerging Technologies | PX G-Series for CO2 refrigeration and other industrial applications. | This is the growth engine intended to diversify revenue beyond desalination. |
Analyzing Revenue: Products, Geography and Growth
Revenue by Products
Product revenue - Year on Year
Revenue by Geography
Geography revenue - Year on Year
Valuation
Trailing PE 102.14 | Forward PE 22.32 | Enterprise Value 288.09M | Price to Sales(TTM) 3.64 |
Enterprise Value 288.09M | Price to Sales(TTM) 3.64 | ||
Enterprise Value to Revenue 2.89 | Enterprise Value to EBITDA 33.68 | Shares Outstanding 50.76M | Shares Floating 48.91M |
Shares Outstanding 50.76M | Shares Floating 48.91M | ||
Percent Insiders 2.15 | Percent Institutions 94.76 |
Financial Metrics
🧭 Investment Snapshot
Total Revenue (Scale)
Total money earned from selling products or services before any costs. It is needed to understand the scale of the business and its ability to generate income.
Net Income (Profit)
Final profit after all expenses, interest, and taxes are deducted. It is needed to determine the overall profitability available to shareholders.
Free Cash Flow (Cash Strength)
Cash remaining after operating activities and capital expenditures, showing cash available for growth. It is needed to evaluate the company’s ability to invest, pay dividends, or reduce debt.
📈 Growth & Strength
Operating Income (Core Profit)
Profit from core operations after deducting all operating expenses. It is needed to measure how efficiently the company runs its primary business activities.
EBITDA (Cash Earnings)
Earnings before interest, taxes, depreciation, and amortization, indicating operating cash potential. It is needed to compare operating performance across companies without accounting or financing differences.
Gross Profit (Unit Profitability)
Revenue minus cost of revenue, showing profit after direct production costs. It is needed to evaluate core business profitability before overhead expenses.
🛡️ Financial Safety
Cash (Liquidity Buffer)
Total cash and cash equivalents on hand. It is needed to evaluate immediate liquidity and financial flexibility.
Total Debt (Leverage Risk)
Total debt including both short-term and long-term components. It is needed to assess the company’s leverage and financial risk.
Net Working Capital (Short-Term Health)
Current assets minus current liabilities, indicating short-term liquidity strength. It is needed to assess whether the company can meet its short-term obligations.
🧱 Balance Sheet Strength
Stockholder Equity (Net Worth)
Total equity value held by shareholders. It is needed to understand the net worth of the company from the owners’ perspective.
Total Assets (Asset Base)
The full value of everything the company owns, including cash, inventory, equipment, and investments. It is needed to understand the resource base used to generate revenue.
Income Before Tax (Pre-Tax Earnings)
Income before provision for income taxes. It is needed to analyze profitability independent of tax structures.
⚙️ Cost & Drag Factors
Cost of Revenue (Production Cost)
Direct costs required to produce and deliver the products or services sold. It is needed to assess efficiency in production and service delivery.
Total Operating Expenses (Operating Cost)
Indirect costs of running the business such as salaries, marketing, and administration. It is needed to understand how much it costs to sustain ongoing business operations.
Income Tax Expense (Tax Drag)
Amount of taxes paid or payable to the government. It is needed to evaluate the impact of taxation on overall profitability.
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