Contrasting Energy Recovery (NASDAQ:ERII) & Hyster-Yale (NYSE:HY)

Hyster-Yale (NYSE:HY) and Energy Recovery (NASDAQ:ERII) are both small-cap industrials companies, but which is the superior business? We will compare the two businesses based on the strength of their institutional ownership, dividends, valuation, analyst recommendations, profitability, earnings and risk.

Risk and Volatility

Hyster-Yale has a beta of 1.63, meaning that its share price is 63% more volatile than the S&P 500. Comparatively, Energy Recovery has a beta of 0.91, meaning that its share price is 9% less volatile than the S&P 500.

Valuation and Earnings

This table compares Hyster-Yale and Energy Recovery”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Hyster-Yale	$3.77 billion	0.14	-$60.10 million	($6.56)	-4.40
Energy Recovery	$120.57 million	2.84	$22.96 million	$0.28	23.75

Energy Recovery has lower revenue, but higher earnings than Hyster-Yale. Hyster-Yale is trading at a lower price-to-earnings ratio than Energy Recovery, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a breakdown of current ratings for Hyster-Yale and Energy Recovery, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Hyster-Yale	1	1	2	0	2.25
Energy Recovery	1	3	0	0	1.75

Hyster-Yale presently has a consensus price target of $47.50, indicating a potential upside of 64.42%. Energy Recovery has a consensus price target of $11.67, indicating a potential upside of 75.46%. Given Energy Recovery’s higher possible upside, analysts clearly believe Energy Recovery is more favorable than Hyster-Yale.

Profitability

This table compares Hyster-Yale and Energy Recovery’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Hyster-Yale	-3.33%	-21.03%	-4.87%
Energy Recovery	12.72%	8.25%	7.24%

Insider and Institutional Ownership

46.5% of Hyster-Yale shares are held by institutional investors. Comparatively, 83.6% of Energy Recovery shares are held by institutional investors. 37.8% of Hyster-Yale shares are held by company insiders. Comparatively, 2.5% of Energy Recovery shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Summary

Energy Recovery beats Hyster-Yale on 9 of the 14 factors compared between the two stocks.

About Hyster-Yale

Hyster-Yale, Inc., through its subsidiaries, designs, engineers, manufactures, sells, and services a line of lift trucks, attachments, and aftermarket parts worldwide. The company manufactures components, such as frames, masts, and transmissions; and assembles lift trucks. It markets its products primarily under the Hyster and Yale brand names to independent Hyster and Yale retail dealerships. The company also sells aftermarket parts under the Hyster and Yale, as well as UNISOURCE and PREMIER brands to Hyster and Yale dealers for the service of competitor lift trucks. In addition, it produces and distributes attachments, forks, and lift tables under the Bolzoni, Auramo, and Meyer brand names; and designs and produces products in the port equipment and rough terrain forklift markets. Further, the company designs, manufactures, and sells hydrogen fuel-cell stacks and engines. It serves light and heavy manufacturers, trucking and automotive companies, rental companies, building materials and paper suppliers, lumber, metal products, warehouses, retailers, food distributors, container handling companies, and U.S. and non-U.S. governmental agencies. The company was formerly known as Hyster-Yale Materials Handling, Inc. and changed its name to Hyster-Yale, Inc. in June 2024. Hyster-Yale, Inc. was incorporated in 1991 and is headquartered in Cleveland, Ohio.

About Energy Recovery

Energy Recovery, Inc., together with its subsidiaries, designs, manufactures, and sells energy efficiency technology solutions in the Americas, the Middle East, Africa, Asia, and Europe. The company operates through Water and Emerging Technologies segments. The company offers high and low pressure, and ultra pressure exchangers; AT and LPT hydraulic turbochargers; and high-pressure feed and circulation booster pumps for use in seawater and brackish desalination, and wastewater treatment. It also provides PX G1300, which reduces energy consumption and operating costs of carbon dioxide-based refrigeration systems; and spare parts, as well as repair, field, and commissioning services. It sells its products under the ERI, PX, Pressure Exchanger, PX Pressure Exchanger, Ultra PX, PX G, PX G1300, PX PowerTrain, AT, and Aquabold brands to original equipment manufacturers, supermarket chains, cold storage facilities, refrigeration system installers, and other industrial users; aftermarket customers consisting of desalination plant owners and operators; and project developers, end-users, and industry consultants, as well as engineering, procurement, and construction firms. Energy Recovery, Inc. was incorporated in 1992 and is headquartered in San Leandro, California.