Energy Recovery (NASDAQ:ERII) Reaches New 1-Year Low - Should You Sell?

Key Points

• Shares hit a new 52-week low, trading as low as $9.30 (last $9.43) and down about 18.8% on heavy volume after the earnings release.
• Q1 results showed a revenue beat ($9.71M vs. $8.37M) but an EPS miss (‑$0.11 vs. ‑$0.10); management cited a new product and long‑term market growth yet warned that the Middle East conflict creates order‑timing uncertainty.
• Analysts have a consensus "Moderate Buy" with an average price target of $15, but insiders sold roughly 238,551 shares in the past three months, signaling mixed near‑term sentiment.

Energy Recovery, Inc. (NASDAQ:ERII - Get Free Report)'s share price hit a new 52-week low on Friday . The company traded as low as $9.30 and last traded at $9.43, with a volume of 3620534 shares changing hands. The stock had previously closed at $11.61.

Key Stories Impacting Energy Recovery

Here are the key news stories impacting Energy Recovery this week:

• Positive Sentiment: Q1 sales beat analyst estimates, signaling demand resilience and supporting near‑term top‑line expectations. Energy Recovery’s NASDAQ: ERII Q1 CY2026 Sales Top Estimates
• Positive Sentiment: Management highlighted a new product launch that could expand addressable markets and support revenue growth over time. ERII Q1 deep dive: New product launch and Middle East conflict shape outlook
• Positive Sentiment: Industry research points to multi‑year growth in ventilation/energy recovery markets, which supports ERII’s long‑term opportunity. Energy Recovery Ventilation System Market Growth, Demand Analysis & Forecast 2026–2035
• Neutral Sentiment: Company released its Q1 earnings press release, shareholder letter and hosted a conference call; transcripts are available for investors to assess management’s detail on guidance and execution. Energy Recovery Reports its First Quarter 2026 Financial Results and Organizational Updates
• Neutral Sentiment: Full earnings call transcripts provide color on backlog, margins and execution; useful for discerning whether recent revenue beats translate into sustained improvement. Energy Recovery, Inc. (ERII) Q1 2026 Earnings Call Transcript
• Negative Sentiment: Reported EPS missed estimates (a small loss of $0.11 vs. consensus of -$0.10), which, despite the revenue beat, raised near‑term profitability concerns and likely triggered short‑term selling. Energy Recovery (ERII) Reports Q1 Loss, Tops Revenue Estimates
• Negative Sentiment: Management cited the Middle East conflict as a factor creating order‑timing uncertainty and potential near‑term demand disruption, adding risk to the outlook. ERII Q1 deep dive: New product launch and Middle East conflict shape outlook

Analysts Set New Price Targets

ERII has been the subject of a number of research reports. Loop Capital set a $13.00 price target on shares of Energy Recovery in a report on Monday, March 2nd. Northcoast Research lowered shares of Energy Recovery from a "buy" rating to a "neutral" rating in a report on Wednesday, April 15th. Finally, Weiss Ratings reissued a "hold (c-)" rating on shares of Energy Recovery in a report on Monday, April 27th. One research analyst has rated the stock with a Strong Buy rating, one has issued a Buy rating and three have issued a Hold rating to the company's stock. Based on data from MarketBeat, the company has a consensus rating of "Moderate Buy" and an average price target of $15.00.

Energy Recovery Trading Down 18.8%

The company has a market capitalization of $490.38 million, a P/E ratio of 24.82 and a beta of 1.04. The business has a 50 day moving average price of $10.62 and a 200 day moving average price of $13.40.

Energy Recovery (NASDAQ:ERII - Get Free Report) last announced its quarterly earnings results on Wednesday, May 6th. The industrial products company reported ($0.11) EPS for the quarter, missing analysts' consensus estimates of ($0.10) by ($0.01). The company had revenue of $9.71 million during the quarter, compared to the consensus estimate of $8.37 million. Energy Recovery had a net margin of 15.07% and a return on equity of 10.80%. On average, analysts forecast that Energy Recovery, Inc. will post 0.42 EPS for the current fiscal year.

Insider Buying and Selling at Energy Recovery

In other news, Director Arve Hanstveit sold 165,292 shares of the business's stock in a transaction on Thursday, April 2nd. The shares were sold at an average price of $10.14, for a total value of $1,676,060.88. Following the completion of the transaction, the director owned 384,928 shares of the company's stock, valued at $3,903,169.92. The trade was a 30.04% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, SVP Rodney Clemente sold 20,568 shares of the business's stock in a transaction on Wednesday, March 4th. The shares were sold at an average price of $10.61, for a total transaction of $218,226.48. Following the completion of the transaction, the senior vice president directly owned 116,008 shares of the company's stock, valued at $1,230,844.88. This trade represents a 15.06% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 238,551 shares of company stock valued at $2,456,512 in the last three months. 3.20% of the stock is owned by company insiders.

Hedge Funds Weigh In On Energy Recovery

Several institutional investors and hedge funds have recently made changes to their positions in ERII. Royal Bank of Canada grew its holdings in shares of Energy Recovery by 43.1% in the 1st quarter. Royal Bank of Canada now owns 16,257 shares of the industrial products company's stock valued at $258,000 after buying an additional 4,899 shares during the period. Jacobs Levy Equity Management Inc. acquired a new position in shares of Energy Recovery in the 1st quarter valued at $341,000. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. grew its holdings in shares of Energy Recovery by 7.6% in the 1st quarter. MIRAE ASSET GLOBAL ETFS HOLDINGS Ltd. now owns 44,929 shares of the industrial products company's stock valued at $714,000 after buying an additional 3,185 shares during the period. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC grew its holdings in shares of Energy Recovery by 10.7% in the 1st quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 206,038 shares of the industrial products company's stock valued at $3,274,000 after buying an additional 19,992 shares during the period. Finally, Jane Street Group LLC grew its holdings in shares of Energy Recovery by 54.4% in the 1st quarter. Jane Street Group LLC now owns 122,369 shares of the industrial products company's stock valued at $1,944,000 after buying an additional 43,089 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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