Energy Recovery (NASDAQ:ERII) Releases Quarterly Earnings Results, Misses Estimates By $0.04 EPS

Energy Recovery (NASDAQ:ERII) posted its earnings results on Wednesday. The industrial products company reported ($0.10) EPS for the quarter, missing the consensus estimate of ($0.06) by ($0.04), FiscalAI reports. The firm had revenue of $11.20 million during the quarter, compared to the consensus estimate of $16.16 million. Energy Recovery had a return on equity of 8.25% and a net margin of 12.72%.

Here are the key takeaways from Energy Recovery’s conference call:

• Megaproject activity is recovering: Energy Recovery signed more than $30 million in contracts in the last 30 days, has a backlog above $60 million, and sees at least $50 million of Megaproject revenue in 2027. Its project pipeline reached a record $525 million and management says it is becoming more geographically diversified.
• Despite the improving pipeline, shipment timing remains difficult to predict, and the company did not restore guidance. Management said projects are progressing and it knows of no cancellations, but timing uncertainty could affect when revenue is recognized.
• The company highlighted its desalination technology position, saying it won every Megaproject above 100,000 cubic meters per day in 2026. Its new PX Q650 has secured an initial contract for the Jubail plant, and management said the product roadmap has been accelerated.
• After closing its CO2 business, Energy Recovery says it is a debt-free, pure-play water technology company with nearly $86 million in cash and investments and about $26 million in year-to-date free cash flow. Cost actions have reduced quarterly operating expenses 17% from last year, and the company has repurchased nearly $109 million of stock since Q4 2024.
• Management acknowledged wastewater performance was below expectations, though it expects a Q4 improvement following a sales-organization merger and renewed go-to-market focus. Aftermarket customers are also reducing spare-parts inventories amid constrained budgets.

Energy Recovery Stock Down 10.0%

NASDAQ:ERII traded down $0.72 during trading hours on Thursday, reaching $6.45. The company had a trading volume of 889,345 shares, compared to its average volume of 886,007. The stock has a 50-day moving average of $7.06 and a two-hundred day moving average of $9.52. Energy Recovery has a one year low of $6.25 and a one year high of $16.30. The firm has a market capitalization of $332.43 million, a PE ratio of 23.01 and a beta of 0.89.

Analysts Set New Price Targets

ERII has been the topic of a number of research analyst reports. B. Riley Financial lowered their price objective on shares of Energy Recovery from $10.00 to $8.00 and set a “neutral” rating on the stock in a research note on Thursday, August 6th. Weiss Ratings downgraded shares of Energy Recovery from a “sell (d+)” rating to a “sell (d)” rating in a research report on Wednesday, September 16th. Finally, Seaport Research Partners cut Energy Recovery from a “buy” rating to a “neutral” rating in a research note on Monday, September 14th. Three analysts have rated the stock with a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat, the company has a consensus rating of “Reduce” and a consensus target price of $11.67.

About Energy Recovery

Energy Recovery, Inc develops and manufactures energy-efficiency technologies for industrial fluid-flow applications. The company is best known for its pressure exchanger systems, which capture hydraulic energy from high-pressure fluid streams and transfer it to lower-pressure incoming fluids. This process can reduce energy consumption and operating costs in demanding industrial environments.

Energy Recovery’s products are used extensively in seawater and brackish-water reverse-osmosis desalination, where its PX Pressure Exchanger technology helps recover energy from the high-pressure reject stream.