ENERGY RECOVERY INC (ERII) Stock Fundamental Analysis
NASDAQ:ERII - US29270J1007 - Common Stock
14.1 USD
-0.24 (-1.67%)
14.1 USD
0 (0%)
Overall ERII gets a fundamental rating of 7 out of 10. We evaluated ERII against 128 industry peers in the Machinery industry. ERII gets an excellent profitability rating and is at the same time showing great financial health properties. While showing a medium growth rate, ERII is valued expensive at the moment. This makes ERII very considerable for quality investing!
1. Profitability
1.1 Basic Checks
ERII had positive earnings in the past year.
ERII had a positive operating cash flow in the past year.
Each year in the past 5 years ERII has been profitable.
ERII had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of ERII (11.37%) is better than 85.94% of its industry peers.
ERII has a Return On Equity of 13.03%. This is in the better half of the industry: ERII outperforms 66.41% of its industry peers.
With a decent Return On Invested Capital value of 10.05%, ERII is doing good in the industry, outperforming 71.09% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ERII is in line with the industry average of 9.99%.
The 3 year average ROIC (8.12%) for ERII is below the current ROIC(10.05%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.37% | ||
| ROE | 13.03% | ||
| ROIC | 10.05% |
ROA(3y)9.69%
ROA(5y)9.73%
ROE(3y)11.24%
ROE(5y)11.42%
ROIC(3y)8.12%
ROIC(5y)8.81%
1.3 Margins
ERII has a better Profit Margin (17.02%) than 93.75% of its industry peers.
In the last couple of years the Profit Margin of ERII has grown nicely.
ERII has a better Operating Margin (17.35%) than 81.25% of its industry peers.
In the last couple of years the Operating Margin of ERII has grown nicely.
ERII has a better Gross Margin (66.76%) than 99.22% of its industry peers.
ERII's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.35% | ||
| PM (TTM) | 17.02% | ||
| GM | 66.76% |
OM growth 3Y4.79%
OM growth 5Y5.06%
PM growth 3Y5.01%
PM growth 5Y4.86%
GM growth 3Y-0.83%
GM growth 5Y-2.69%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ERII is destroying value.
ERII has less shares outstanding than it did 1 year ago.
ERII has less shares outstanding than it did 5 years ago.
There is no outstanding debt for ERII. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
An Altman-Z score of 19.08 indicates that ERII is not in any danger for bankruptcy at the moment.
ERII has a Altman-Z score of 19.08. This is amongst the best in the industry. ERII outperforms 98.44% of its industry peers.
ERII has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 19.08 |
ROIC/WACC0.97
WACC10.33%
2.3 Liquidity
A Current Ratio of 8.08 indicates that ERII has no problem at all paying its short term obligations.
Looking at the Current ratio, with a value of 8.08, ERII belongs to the top of the industry, outperforming 95.31% of the companies in the same industry.
A Quick Ratio of 6.34 indicates that ERII has no problem at all paying its short term obligations.
With an excellent Quick ratio value of 6.34, ERII belongs to the best of the industry, outperforming 95.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 8.08 | ||
| Quick Ratio | 6.34 |
3. Growth
3.1 Past
The earnings per share for ERII have decreased by -5.77% in the last year.
ERII shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 27.65% yearly.
The Revenue has been growing slightly by 6.19% in the past year.
Measured over the past years, ERII shows a quite strong growth in Revenue. The Revenue has been growing by 10.77% on average per year.
EPS 1Y (TTM)-5.77%
EPS 3Y34.63%
EPS 5Y27.65%
EPS Q2Q%-53.33%
Revenue 1Y (TTM)6.19%
Revenue growth 3Y11.74%
Revenue growth 5Y10.77%
Sales Q2Q%-27.3%
3.2 Future
Based on estimates for the next years, ERII will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.43% on average per year.
The Revenue is expected to grow by 13.66% on average over the next years. This is quite good.
EPS Next Y3.12%
EPS Next 2Y15.42%
EPS Next 3Y12.43%
EPS Next 5YN/A
Revenue Next Year4.05%
Revenue Next 2Y8.46%
Revenue Next 3Y12.22%
Revenue Next 5Y13.66%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 28.78, which means the current valuation is very expensive for ERII.
ERII's Price/Earnings is on the same level as the industry average.
Compared to an average S&P500 Price/Earnings ratio of 26.84, ERII is valued at the same level.
A Price/Forward Earnings ratio of 17.35 indicates a rather expensive valuation of ERII.
63.28% of the companies in the same industry are more expensive than ERII, based on the Price/Forward Earnings ratio.
ERII is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.48, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.78 | ||
| Fwd PE | 17.35 |
4.2 Price Multiples
65.63% of the companies in the same industry are cheaper than ERII, based on the Enterprise Value to EBITDA ratio.
64.06% of the companies in the same industry are cheaper than ERII, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 37.18 | ||
| EV/EBITDA | 20.76 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ERII does not grow enough to justify the current Price/Earnings ratio.
ERII has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as ERII's earnings are expected to grow with 12.43% in the coming years.
PEG (NY)9.24
PEG (5Y)1.04
EPS Next 2Y15.42%
EPS Next 3Y12.43%
5. Dividend
5.1 Amount
No dividends for ERII!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
14.1
-0.24 (-1.67%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryMachinery
Earnings (Last)
Earnings (Next)
Inst Owners89.09%
Inst Owner Change-0.48%
Ins Owners2.75%
Ins Owner Change-1.36%
Market Cap750.12M
Analysts82.22
Price Target16.83 (19.36%)
Short Float %2.09%
Short Ratio2.54
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)736.33%
Min EPS beat(2)-488.23%
Max EPS beat(2)1960.88%
EPS beat(4)3
Avg EPS beat(4)388.29%
Min EPS beat(4)-488.23%
Max EPS beat(4)1960.88%
EPS beat(8)5
Avg EPS beat(8)227.58%
EPS beat(12)7
Avg EPS beat(12)140.43%
EPS beat(16)9
Avg EPS beat(16)141.74%
Revenue beat(2)1
Avg Revenue beat(2)-27.88%
Min Revenue beat(2)-63.91%
Max Revenue beat(2)8.15%
Revenue beat(4)1
Avg Revenue beat(4)-15.32%
Min Revenue beat(4)-63.91%
Max Revenue beat(4)8.15%
Revenue beat(8)2
Avg Revenue beat(8)-9.06%
Revenue beat(12)4
Avg Revenue beat(12)-8.29%
Revenue beat(16)6
Avg Revenue beat(16)-6.11%
PT rev (1m)13.79%
PT rev (3m)-16.1%
EPS NQ rev (1m)-46.55%
EPS NQ rev (3m)-63.74%
EPS NY rev (1m)14.2%
EPS NY rev (3m)5.72%
Revenue NQ rev (1m)-23.17%
Revenue NQ rev (3m)-43.56%
Revenue NY rev (1m)1.27%
Revenue NY rev (3m)-0.73%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.78 | ||
| Fwd PE | 17.35 | ||
| P/S | 5.29 | ||
| P/FCF | 37.18 | ||
| P/OCF | 36.11 | ||
| P/B | 4.05 | ||
| P/tB | 4.35 | ||
| EV/EBITDA | 20.76 |
EPS(TTM)0.49
EY3.48%
EPS(NY)0.81
Fwd EY5.76%
FCF(TTM)0.38
FCFY2.69%
OCF(TTM)0.39
OCFY2.77%
SpS2.66
BVpS3.48
TBVpS3.24
PEG (NY)9.24
PEG (5Y)1.04
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.37% | ||
| ROE | 13.03% | ||
| ROCE | 12.72% | ||
| ROIC | 10.05% | ||
| ROICexc | 17.06% | ||
| ROICexgc | 19.22% | ||
| OM | 17.35% | ||
| PM (TTM) | 17.02% | ||
| GM | 66.76% | ||
| FCFM | 14.23% |
ROA(3y)9.69%
ROA(5y)9.73%
ROE(3y)11.24%
ROE(5y)11.42%
ROIC(3y)8.12%
ROIC(5y)8.81%
ROICexc(3y)14.22%
ROICexc(5y)18.19%
ROICexgc(3y)15.9%
ROICexgc(5y)21.13%
ROCE(3y)10.28%
ROCE(5y)11.16%
ROICexcg growth 3Y-2%
ROICexcg growth 5Y0.91%
ROICexc growth 3Y0.06%
ROICexc growth 5Y2.77%
OM growth 3Y4.79%
OM growth 5Y5.06%
PM growth 3Y5.01%
PM growth 5Y4.86%
GM growth 3Y-0.83%
GM growth 5Y-2.69%
F-Score7
Asset Turnover0.67
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 9.05% | ||
| Cap/Sales | 0.42% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.55% | ||
| Profit Quality | 83.63% | ||
| Current Ratio | 8.08 | ||
| Quick Ratio | 6.34 | ||
| Altman-Z | 19.08 |
F-Score7
WACC10.33%
ROIC/WACC0.97
Cap/Depr(3y)44.7%
Cap/Depr(5y)74.94%
Cap/Sales(3y)2.09%
Cap/Sales(5y)3.68%
Profit Quality(3y)75.85%
Profit Quality(5y)62.74%
High Growth Momentum
Growth
EPS 1Y (TTM)-5.77%
EPS 3Y34.63%
EPS 5Y27.65%
EPS Q2Q%-53.33%
EPS Next Y3.12%
EPS Next 2Y15.42%
EPS Next 3Y12.43%
EPS Next 5YN/A
Revenue 1Y (TTM)6.19%
Revenue growth 3Y11.74%
Revenue growth 5Y10.77%
Sales Q2Q%-27.3%
Revenue Next Year4.05%
Revenue Next 2Y8.46%
Revenue Next 3Y12.22%
Revenue Next 5Y13.66%
EBIT growth 1Y46.43%
EBIT growth 3Y17.08%
EBIT growth 5Y16.38%
EBIT Next Year122.29%
EBIT Next 3Y51.89%
EBIT Next 5YN/A
FCF growth 1Y183.7%
FCF growth 3Y41.07%
FCF growth 5YN/A
OCF growth 1Y114.74%
OCF growth 3Y14.91%
OCF growth 5Y31.24%