Latest Ratios: P/E Ratio 17.0x · EV/EBITDA 11.6x · ROE 11.0%. (2006–2025 historical series)
Price-based multiples — how expensive the stock is relative to earnings, sales, book value, and cash flow
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Market Cap | $367M | $731M | $850M | $1.1B | $1.2B | $1.3B | $773M | $549M | $372M | $487M | $574M |
| Enterprise Value | $328M | $692M | $832M | $1.0B | $1.1B | $1.2B | $696M | $535M | $364M | $459M | $513M |
| P/E Ratio → | 16.95 | 32.12 | 36.75 | 50.92 | 48.79 | 89.54 | 29.02 | 51.53 | 16.82 | 26.52 | 147.86 |
| P/S Ratio | 2.72 | 5.42 | 5.86 | 8.48 | 9.40 | 12.15 | 8.39 | 7.54 | 5.00 | 7.70 | 10.49 |
| P/B Ratio | 1.87 | 3.54 | 4.05 | 4.95 | 6.37 | 7.06 | 4.50 | 4.04 | 3.28 | 5.90 | 8.81 |
| P/FCF | 21.04 | 41.89 | 44.21 | 46.32 | 124.31 | 184.31 | 76.60 | — | 159.84 | — | 148.95 |
| P/OCF | 19.55 | 38.92 | 41.42 | 41.75 | 93.51 | 93.30 | 45.79 | 104.19 | 49.23 | 168.08 | 115.59 |
P/E links to full P/E history page with 30-year chart
Enterprise-value multiples — capital-structure-neutral measures of total business value
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| EV / Revenue | — | 5.14 | 5.74 | 8.05 | 9.07 | 11.59 | 7.56 | 7.35 | 4.88 | 7.27 | 9.37 |
| EV / EBITDA | 11.60 | 24.44 | 32.56 | 41.66 | 36.61 | 60.90 | 19.02 | 36.25 | 26.30 | 66.10 | 126.97 |
| EV / EBIT | 13.37 | 25.07 | 37.46 | 45.50 | 43.71 | 85.98 | 20.70 | 51.63 | 31.81 | 49.61 | 137.94 |
| EV / FCF | — | 39.68 | 43.26 | 43.98 | 119.94 | 175.85 | 69.01 | — | 156.20 | — | 133.04 |
Margins and return-on-capital ratios measuring operating efficiency
Full margin charts and quarterly trend are on the Earnings History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross Margin | 65.2% | 65.2% | 66.9% | 67.8% | 69.6% | 68.6% | 69.3% | 72.1% | 76.0% | 69.8% | 67.4% |
| Operating Margin | 18.2% | 18.2% | 13.6% | 14.8% | 19.8% | 13.3% | 34.0% | 14.2% | 13.4% | 5.2% | 0.7% |
| Net Profit Margin | 17.0% | 17.0% | 15.9% | 16.8% | 19.1% | 13.7% | 28.7% | 15.0% | 29.6% | 19.6% | 1.9% |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| ROE | 11.0% | 11.0% | 10.7% | 10.6% | 13.2% | 8.1% | 17.2% | 8.8% | 22.6% | 16.7% | 1.6% |
| ROA | 9.7% | 9.7% | 9.3% | 9.2% | 11.2% | 6.8% | 13.4% | 5.9% | 12.9% | 7.9% | 0.7% |
| ROIC | 10.3% | 10.3% | 8.3% | 9.3% | 14.1% | 9.6% | 21.6% | 6.8% | 9.4% | 8.4% | 7.0% |
| ROCE | 11.3% | 11.3% | 8.7% | 8.9% | 12.6% | 7.2% | 17.9% | 6.6% | 6.8% | 2.4% | 0.3% |
Solvency and debt-coverage ratios — lower is generally safer
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Debt / Equity | 0.05 | 0.05 | 0.05 | 0.06 | 0.08 | 0.09 | 0.10 | 0.09 | 0.12 | 0.00 | 0.00 |
| Debt / EBITDA | 0.33 | 0.33 | 0.44 | 0.54 | 0.48 | 0.83 | 0.48 | 0.85 | 0.97 | 0.00 | 0.01 |
| Net Debt / Equity | — | -0.19 | -0.09 | -0.25 | -0.22 | -0.32 | -0.45 | -0.10 | -0.07 | -0.34 | -0.94 |
| Net Debt / EBITDA | -1.36 | -1.36 | -0.72 | -2.21 | -1.33 | -2.93 | -2.09 | -0.94 | -0.61 | -4.00 | -15.19 |
| Debt / FCF | — | -2.22 | -0.95 | -2.33 | -4.37 | -8.46 | -7.59 | — | -3.64 | — | -15.92 |
| Interest Coverage | — | — | — | — | — | — | — | — | 11441.00 | 4624.50 | 1238.67 |
Net cash position: cash ($48M) exceeds total debt ($9M)
Short-term solvency ratios and asset-utilisation metrics
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Current Ratio | 10.44 | 10.44 | 7.41 | 8.64 | 8.63 | 7.67 | 9.10 | 4.06 | 4.41 | 6.36 | 7.13 |
| Quick Ratio | 9.04 | 9.04 | 6.35 | 7.42 | 7.08 | 6.64 | 8.36 | 3.69 | 4.15 | 6.08 | 6.87 |
| Cash Ratio | 4.34 | 4.34 | 3.33 | 5.06 | 4.91 | 5.34 | 7.29 | 3.06 | 3.51 | 4.93 | 5.85 |
| Asset Turnover | — | 0.58 | 0.60 | 0.51 | 0.58 | 0.49 | 0.45 | 0.39 | 0.41 | 0.39 | 0.37 |
| Inventory Turnover | 1.93 | 1.93 | 1.93 | 1.58 | 1.35 | 1.60 | 2.40 | 1.97 | 2.50 | 3.46 | 3.92 |
| Days Sales Outstanding | — | 207.67 | 169.92 | 136.82 | 104.92 | 74.15 | 51.93 | 67.55 | 70.02 | 110.86 | 93.70 |
Earnings, FCF, buyback, and dividend yields — total returns to shareholders
Full dividend history and growth charts are on the Dividend History page
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Dividend Yield | — | — | — | — | — | — | — | — | — | — | — |
| Payout Ratio | — | — | — | — | — | — | — | — | — | — | — |
| Metric | TTM | FY 2025 | FY 2024 | FY 2023 | FY 2022 | FY 2021 | FY 2020 | FY 2019 | FY 2018 | FY 2017 | FY 2016 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Earnings Yield | 5.9% | 3.1% | 2.7% | 2.0% | 2.0% | 1.1% | 3.4% | 1.9% | 5.9% | 3.8% | 0.7% |
| FCF Yield | 4.8% | 2.4% | 2.3% | 2.2% | 0.8% | 0.5% | 1.3% | — | 0.6% | — | 0.7% |
| Buyback Yield | 9.7% | 4.9% | 5.9% | 0.0% | 2.3% | 1.8% | 0.0% | 0.0% | 2.7% | 0.9% | 1.6% |
| Total Shareholder Yield | 9.7% | 4.9% | 5.9% | 0.0% | 2.3% | 1.8% | 0.0% | 0.0% | 2.7% | 0.9% | 1.6% |
| Shares Outstanding | — | $54M | $58M | $58M | $58M | $59M | $57M | $56M | $55M | $56M | $55M |
Includes 30+ ratios · 20 years · Updated daily
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Quick answers to the most common questions about buying ERII stock.
Energy Recovery, Inc.'s current P/E ratio is 17.0x. The historical average is 55.9x. This places it at the 8th percentile of its historical range.
Energy Recovery, Inc.'s current EV/EBITDA is 11.6x. This enterprise value multiple compares the company's total value (equity + debt - cash) to its EBITDA. The historical average is 36.9x.
Energy Recovery, Inc.'s return on equity (ROE) is 11.0%. The historical average is 6.3%.
Based on historical data, Energy Recovery, Inc. is trading at a P/E of 17.0x. This is at the 8th percentile of its historical P/E range. Compare with industry peers and growth rates for a complete picture.
Energy Recovery, Inc. has 65.2% gross margin and 18.2% operating margin. Operating margin between 10-20% is typical for established companies.
Energy Recovery, Inc.'s Debt/EBITDA ratio is 0.3x, indicating low leverage. A ratio below 2x is generally considered financially healthy.
Key Metrics
Top Statement Risk
Project-based revenue volatility
Metrics are mathematically derived from official filings.
Valuation Premium Reflects Growth Optionality
According to current market data, ERII trades at a P/E of 21.00 and an EV/EBITDA of 14.69, suggesting that investors are pricing in significant future growth from the emerging CO2 refrigeration segment rather than relying solely on the cyclical, project-dependent cash flows of the core water business.
The valuation appears to command a premium relative to traditional industrial peers, likely due to the company's proprietary ceramic technology and its potential to disrupt the HVAC market. However, the lack of a forward P/E ratio in the data suggests that market participants remain uncertain about the timing and scale of earnings contributions from new technology initiatives.
Capital Efficiency Subject to Cyclicality
As reported in financial statements, ERII's ROIC has fluctuated significantly, peaking at 15.4% in 2025Q4 before turning negative in 2026Q1, which highlights the company's struggle to maintain efficient capital deployment during periods of reduced project activity and high R&D investment in emerging technologies.
The volatility in ROIC suggests that the company's ability to compound returns is heavily tethered to the successful execution of large-scale desalination projects. Investors should monitor whether the pivot to CO2 refrigeration can eventually provide a more stable, less capital-intensive return profile than the current project-based model.
Working Capital Cycles Impair Efficiency
Based on the provided quarterly data, the Cash Conversion Cycle has exhibited extreme variance, reaching a high of 1191 days in 2025Q1, which indicates that the company's working capital efficiency is highly sensitive to the timing of milestone payments and inventory buildup for major desalination projects.
The extended DSO and DIO figures suggest that the company lacks significant leverage over its customers, who are often large municipal or sovereign entities with lengthy payment cycles. This structural inefficiency necessitates a high liquidity buffer to manage the cash flow gaps inherent in the current business model.
Fortress Liquidity Buffers Operational Risk
According to recent quarterly filings, ERII maintains a robust liquidity position with a current ratio that peaked at 10.71 in 2025Q4, providing a substantial safety margin that appears designed to absorb the extreme revenue volatility associated with its project-based desalination business model.
The company's reliance on internal cash rather than debt, evidenced by a D/E ratio near 0.05, suggests a conservative management approach that prioritizes financial stability over aggressive leverage. This liquidity cushion is essential for navigating the long lead times and potential project delays that characterize the industrial water sector.
Misapplication of P/E Multiples
The P/E ratio is frequently misapplied to ERII, as it obscures the impact of lumpy, project-based revenue recognition and significant R&D spending on emerging technologies, which together create a distorted view of the company's true, normalized earning power in its mature water segment.
Analysts should instead focus on EV/EBITDA or adjusted free cash flow metrics to better capture the underlying operational performance, as GAAP earnings are often skewed by non-recurring project milestones and stock-based compensation. Relying on P/E alone may lead to an inaccurate assessment of the company's valuation during cyclical troughs.