Energy Recovery (ERII)

people love this stock.

Water is in short supply and growth in thrid world countries is as dependent on water as it is on oil. This company has a technology that reduces the deslatination costs by roughly 50%.

Lots of cash and growth.

This is first and foremost a bullish call on the growth of desalination projects around the globe, which I think is a very safe source of growth over the coming decade. But Energy Recovery also has a great business on best-in-class energy recovery devices for desalination plants, and will grow both with new installations and retrofits.

Prior to the recession, ERII was growing its revenue and earnings at racehorse speed (~79% and 100%+, respectively). When the global economic recovery kicks in, the demand for cheaper, more energy efficient desalinized water should, if anything, grow stronger, not weaker. If ERII merely returns to its prior peak EPS (2008: 18 cents) with a conservative (PEG-wise) PE of 40, its near-term target will be $7+. Five analysts see its EPS reaching 21 to 45 cents by 2011, growing its earnings at ~100% per year, 2009-2011. With a 50-100 PE, that's a 2-year target of $10-$45. Mash it all together, and I'm hoping for a $15 SP within 2-3 years, $30 within 5.

Kind of a crap shoot here. Water going to be an issue with 8 billion people. Could soar I suppose. Going to stick my big toe in on this one.

Water due to Global warming, and population explosion, will be the next oil. If you can produce cheap you will have a thirsty and captive audience :)

Got some upward momentum - not sure it will last though.

How can you possibly refuse not to pick a company that helps reduce the energy cost of SWRO Desalination by 60%. Will it's revenue be bit lumpy? Of course for awhile yet ( 1-2yr). Especially when the World population is pushing toward 7 Billion and the percentage of fresh water throughout the entire World is less than 1%! Their technology is patentable but the ceramic rotor patent does expire in 1 yr. They have also taken control of their own parts supply by producing up 50% of ceramic parts needs. (Hopefully at a lower real cost than they could purchase). But, the opportunity cost of not having the parts in the first place would be even greater in lost sales. They will continue to lead and perhaps become a purchase target by someone like G.E. or PICO.

Does the original inventor Hauge propose a problem. I don't so much so because he's so much of a perfectionist he misses opportunities to get product into production. I really don't think that Hauge can make any significant changes to a product that is already 98% Efficient. Capturing another 1 or 2% would come at too high a cost to generate returns.
ERII will steam ahead.

+
Low/No Debt
Great product
Lucrative market

-
Had a bad Q2/09

I think they're at a good price now...

Too many people, not enough water. Desalinization will become a popular alternative in a world with a growing population and increasing socioeconomic expectations. ERII has a good product and sound fundamentals.

energy recovery devices for sewater.... the ice caps are melting and fresh water is becomeing more and more unavailable for some around the world.

I picked this stock because I am not good at investing. This is the proof.

I think water will be a growing commodity over time, especially in areas such as the middle east. Energy Recovery has a unique business and a stellar product. Market leader and a key asset in being very cost effective during the desalination process. I've added a small amount to my personal portfolio.

I like the strategy of this company and I believe in the future of clean water needs, I'm only weary of the high P/E right now. Hoping that the recent drop has helped price it a little better so that the company doesn't have to be perfect to live up to the expectations reflected in the stock price.

Mmm...water...

"water, water everywhere but ne're a drop to drink"......
And then came ERII. Water is more important than oil. It won't be too long before it becomes more valuable. It is plentiful (in the oceans) but it is useless (for drinking). It appears that ERII has the technology that can make salt water potable & can do it cost effectively.

Osmotic membranes, eh? There's a few good market offerings for them now but this one looks promising enough to wager a little on. Restaurants and hotels offer steady demand for them and they are expanding into the home market in a few areas with pretty filthy water.

zzzzzzzzzzzzzzzzz