ERII Stock Analysis: Buy, Sell, or Hold?
ERII - Energy Recovery, Inc.
$8.84
-0.06 (-0.67%)
▼
5d:
+0.57%
30d:
+8.07%
90d:
-13.5%
BUY
HIGH Confidence
Analysis Updated: Jul 2, 2026 12:00 AM ET
Earnings: Aug 05, 2026
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Interactive Price Chart (1 Month)
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Bottom Line:
🚀 STRONG BUY: ERII shows excellent value with unusually cheap options (IV 13th percentile) and market pricing in only 4.2% annual growth despite strong fundamentals. High conviction opportunity.
🚀 STRONG BUY: ERII shows excellent value with unusually cheap options (IV 13th percentile) and market pricing in only 4.2% annual growth despite strong fundamentals. High conviction opportunity.
Long-Term Wealth Forecast (2031)
Based on Analyst Consensus Growth & Historical Valuation
0% (Stagnation)
50% (Hyper Growth)
EST. PRICE IN 2031
$15.21
Based on 14.5% avg growth
INTRINSIC VALUE TODAY
$9.44
6.4% Margin of Safety
How this is calculated: We use a Growth Decay Model: starting with analyst consensus growth (adjusted above) and gradually slowing it down to a long-term terminal rate (4%) by Year 5. This provides a more realistic valuation than assuming constant hyper-growth. We then apply a 14.6x Exit PE.
In-depth Analysis How we analyze
Valuation Analysis: ERII is currently trading at $8.84, which is considered slightly high relative to its 30-day fair value range of $8.15 to $8.94. From a valuation perspective, the stock is trading at a premium (Forward PE: 16.5) compared to its historical average (14.6). At these levels, the market is pricing in 4.2% annual earnings growth. This growth rate appears achievable given the company's track record, suggesting the valuation is rational.
Technical Outlook: Technically, ERII is in a strong downtrend. The price is approaching resistance at $8.81. A breakout above this level would be a bullish signal, while rejection here could lead to consolidation.
Market Sentiment: ERII has a strong technical setup (60/100), with favorable trendlines, momentum, and price action for short-term traders. In the options market, Implied Volatility is low (13th percentile), suggesting options premiums are relatively cheap. This makes it an attractive time for long options strategies if you have a directional bias. Wall Street analysts see significant upside, with an average price target of $11.00 (+24.4%). Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Technical Outlook: Technically, ERII is in a strong downtrend. The price is approaching resistance at $8.81. A breakout above this level would be a bullish signal, while rejection here could lead to consolidation.
Market Sentiment: ERII has a strong technical setup (60/100), with favorable trendlines, momentum, and price action for short-term traders. In the options market, Implied Volatility is low (13th percentile), suggesting options premiums are relatively cheap. This makes it an attractive time for long options strategies if you have a directional bias. Wall Street analysts see significant upside, with an average price target of $11.00 (+24.4%). Combining these factors, the current setup offers a favorable risk/reward ratio for buyers.
Quick Decision Summary
Current Position
SLIGHTLY HIGH
Historical Trading Range
$8.15 -
$8.94
Company Quality Score
59/100
(HOLD)
Options IV Signal
13th percentile
(LOW)
Volume Confirmation
HIGH
Confidence Score
81.5%
All Signals
- BULLISH: Options cheap (IV 13th percentile)
- BULLISH: Strong technical setup (60/100)
- BULLISH: High volume confirmation
- BULLISH: Trading 24.4% below Wall St target ($11.00)
- NEUTRAL: Market pricing in 4.2% annual earnings growth - fairly valued
Trading Range Analysis
30-Day Trading Range
$8.15 -
$8.94
Current vs Trading Range
SLIGHTLY HIGH
Expected Move (7 Days)
±$1.03
(11.7%)
Support & Resistance Levels
Support Level
$7.83
Resistance Level
$8.81
Current Trend
Strong Downtrend
Technical data as of
Jun 9, 2026
Fundamental Context
Forward P/E (Next Year Est.)
16.52
Wall Street Target
$11.00
(+24.4%)
Revenue Growth (YoY)
20.3%
Earnings Growth (YoY)
20.1%
Profit Margin
15.1%
Valuation Premium vs History
+4.2% premium
PE vs Historical
16.5 vs 14.6
FAIR
Market-Implied Price Targets
If current PE multiple persists
Implied Growth (YoY):
+4.2%
(market-implied from PE analysis)
1-Year Target
$9.21
(+4%)
2-Year Target
$9.60
(+9%)
3-Year Target
$10.00
(+13%)
3-Yr Target (if PE normalizes)
(PE: 17→15)
PE COMPRESSION
$8.84
(0%)
Earnings growth offset by PE compression
3-Year Scenarios
Using analyst projected EPS growth
Bull:
(PE: 21.8, Growth: 791.7%)
$39.33
(+345%)
Base:
(SPY PE: 16.5, Growth: 791.7%)
$29.84
(+238%)
Bear:
(PE: 14.0, Growth: 791.7%)
$25.36
(+187%)
📈
Valuation based on Current Earnings
RECOVERY PLAY: Stock looks expensive now (24x PE), but valuation improves significantly next year (17x PE) as earnings recover.
Trailing PE: 24.05 | Current EPS (TTM): $0.37
Bull Case
$14.16
(+60%)
Analyst growth 44.6%, PE expands to 26.5
Base Case
$12.87
(+46%)
Market implied 44.6%, PE stable at 24.1
Bear Case
$6.05
(-32%)
Severe decline -20.0%, PE contracts to 20.5
These are projections based on PE multiples and EPS growth scenarios, not predictions. Actual results may vary significantly.
Share & Embed Analysis
Last updated: July 04, 2026 3:17 AM ET
Data refreshes hourly during market hours. Next update: 4:17 AM
Data refreshes hourly during market hours. Next update: 4:17 AM
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Technical Signals Check
Is ERII showing a specific setup today?
Insider Activity (6 Months)
0
Buys
11
Sells
Net
INSIDERS SELLING
Recent Transactions
Arve Hanstveit
SELL
2419 shares
2026-04-06
Arve Hanstveit
SELL
165292 shares
2026-04-02
Arve Hanstveit
SELL
11582 shares
2026-03-06
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