Energy Recovery (NASDAQ:ERII) Rating Lowered to Neutral at Northcoast Research

Key Points

• Northcoast Research downgraded Energy Recovery (NASDAQ:ERII) from a "buy" to a "neutral" rating; the stock's consensus remains a Moderate Buy with an average analyst target around $15.
• Q4 results missed expectations: EPS $0.53 vs. $0.67 expected and revenue $66.6M vs. $82.6M expected, and the company set FY2026 guidance of $0.50–0.70 EPS.
• Significant insider selling has occurred recently—248,811 shares (~$2.6M) sold over the last 90 days, including large sales by the SVP and a director—while institutional investors hold about 83.6% of the stock.

Energy Recovery (NASDAQ:ERII - Get Free Report) was downgraded by equities research analysts at Northcoast Research from a "buy" rating to a "neutral" rating in a report released on Wednesday,Finviz reports.

Several other research firms have also commented on ERII. Weiss Ratings reissued a "hold (c-)" rating on shares of Energy Recovery in a research report on Monday, December 29th. Loop Capital set a $13.00 price target on shares of Energy Recovery in a research report on Monday, March 2nd. One research analyst has rated the stock with a Strong Buy rating, one has issued a Buy rating and three have assigned a Hold rating to the stock. Based on data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average target price of $15.00.

Energy Recovery Stock Performance

ERII stock opened at $11.29 on Wednesday. The firm has a market cap of $596.45 million, a price-to-earnings ratio of 26.26 and a beta of 1.08. The firm has a 50-day simple moving average of $12.08 and a two-hundred day simple moving average of $13.93. Energy Recovery has a one year low of $9.35 and a one year high of $18.32.

Energy Recovery (NASDAQ:ERII - Get Free Report) last released its quarterly earnings results on Wednesday, February 25th. The industrial products company reported $0.53 EPS for the quarter, missing the consensus estimate of $0.67 by ($0.14). The firm had revenue of $66.59 million for the quarter, compared to analysts' expectations of $82.59 million. Energy Recovery had a net margin of 17.01% and a return on equity of 11.92%. Energy Recovery has set its FY 2026 guidance at 0.500-0.700 EPS. As a group, equities analysts predict that Energy Recovery will post 0.36 earnings per share for the current fiscal year.

Insider Activity

In other news, SVP Rodney Clemente sold 20,568 shares of the company's stock in a transaction dated Wednesday, March 4th. The shares were sold at an average price of $10.61, for a total transaction of $218,226.48. Following the transaction, the senior vice president owned 116,008 shares in the company, valued at $1,230,844.88. This represents a 15.06% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. Also, Director Arve Hanstveit sold 165,292 shares of the company's stock in a transaction dated Thursday, April 2nd. The shares were sold at an average price of $10.14, for a total transaction of $1,676,060.88. Following the transaction, the director owned 384,928 shares in the company, valued at approximately $3,903,169.92. This trade represents a 30.04% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold a total of 248,811 shares of company stock worth $2,606,175 over the last 90 days. 3.20% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Energy Recovery

Hedge funds have recently modified their holdings of the stock. Wexford Capital LP acquired a new position in shares of Energy Recovery during the third quarter valued at about $27,000. Hantz Financial Services Inc. increased its holdings in shares of Energy Recovery by 2,581.9% during the third quarter. Hantz Financial Services Inc. now owns 1,931 shares of the industrial products company's stock valued at $30,000 after acquiring an additional 1,859 shares in the last quarter. Parallel Advisors LLC acquired a new position in shares of Energy Recovery during the fourth quarter valued at about $38,000. State of Alaska Department of Revenue acquired a new position in shares of Energy Recovery during the third quarter valued at about $46,000. Finally, Comerica Bank increased its holdings in Energy Recovery by 150.5% in the 4th quarter. Comerica Bank now owns 3,868 shares of the industrial products company's stock worth $52,000 after buying an additional 2,324 shares during the period. Institutional investors and hedge funds own 83.58% of the company's stock.

About Energy Recovery

Energy Recovery, Inc NASDAQ: ERII is an energy technology company specializing in the design and manufacture of high-efficiency devices that capture and repurpose energy in fluid-handling applications. The company's core offering, the Pressure Exchanger® (PX®) device, enables seawater reverse osmosis (SWRO) desalination plants to recover and reuse hydraulic energy that would otherwise be lost during brine discharge. By integrating PX technology into desalination processes, Energy Recovery helps operators significantly reduce the energy consumption and operating costs of producing fresh water from seawater or brackish sources.

In addition to desalination solutions, Energy Recovery has expanded its portfolio to serve the oil and gas sector through turbocharger systems that improve the energy efficiency of hydraulic fracturing operations.

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