Energy recovery device manufacturer Energy Recovery (NASDAQ: ERII) will be reporting results this Wednesday after market close. Here’s what investors should know.
Energy Recovery missed analysts’ revenue expectations last quarter, reporting revenues of $66.87 million, flat year on year. It was a disappointing quarter for the company, with a significant miss of analysts’ revenue estimates and a significant miss of analysts’ adjusted operating income estimates.
Is Energy Recovery a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, the market is expecting Energy Recovery’s revenue to decline 2.6% year on year, improving from the 33.3% decrease it recorded in the same quarter last year.
The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Energy Recovery has missed Wall Street’s revenue estimates multiple times over the last two years.
Looking at Energy Recovery’s peers in the industrial machinery segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Tennant delivered year-on-year revenue growth of 2.7%, beating analysts’ expectations by 3%, and Xylem reported revenues up 2.7%, topping estimates by 0.7%. Xylem traded down 6.6% following the results.
Read our full analysis of Tennant’s results here and Xylem’s results here.
There has been positive sentiment among investors in the industrial machinery segment, with share prices up 7.6% on average over the last month. Energy Recovery is up 5.5% during the same time and is heading into earnings with an average analyst price target of $14 (compared to the current share price of $10.99).
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