Energy recovery device manufacturer Energy Recovery (NASDAQ:ERII) will be reporting results tomorrow afternoon. Here’s what you need to know.

Energy Recovery beat analysts’ revenue expectations by 2.5% last quarter, reporting revenues of $38.58 million, up 4.2% year on year. It was a stunning quarter for the company, with an impressive beat of analysts’ EPS estimates and a solid beat of analysts’ EBITDA estimates.

Is Energy Recovery a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Energy Recovery’s revenue to grow 14.7% year on year to $65.61 million, slowing from the 35.2% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.40 per share.

Analysts covering the company have generally 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 three times over the last two years.

Looking at Energy Recovery’s peers in the water infrastructure segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Mueller Water Products delivered year-on-year revenue growth of 18.7%, beating analysts’ expectations by 5.4%, and Watts Water Technologies reported a revenue decline of 1.3%, topping estimates by 0.6%. Mueller Water Products traded up 16.6% following the results while Watts Water Technologies was also up 7.4%.

Read our full analysis of Mueller Water Products’s results here and Watts Water Technologies’s results here.

Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good 2024. An economic soft landing (so far), the start of the Fed's rate cutting campaign, and the election of Donald Trump were positives for the market, and while some of the water infrastructure stocks have shown solid performance, the group has generally underpeformed, with share prices down 7.4% on average over the last month. Energy Recovery is up 3.6% during the same time and is heading into earnings with an average analyst price target of $19.33 (compared to the current share price of $14.78).

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