Energy Recovery, Inc. (ERII) stock starts with “Overweight” rating in note to investors by Stephens

Energy Recovery, Inc. (NASDAQ: ERII) shares closed lower in early trading today on lighter trade volume than normal after more analysts initiated coverage on the stock.

Meanwhile in early trading, the Dow Jones Industrial Average DJIA, +0.31% rose 24 points, or 0.1%, to 19,883, while the S&P 500 index ESH7, +0.13% dipped less than 1 point to 2,268. The Nasdaq Composite COMP, +0.02% which reached its fourth-straight record close on Tuesday, rose 1 point to 5,553.

Analysts at Stephens initiated coverage on Energy Recovery, Inc. (NASDAQ: ERII) stock, rating the company at Overweight. The company currently has a rating of Overweight on the shares. The one-year price target of $18.75 is higher than the opening price of $11.01, resulting a fair amount of other analysts to report on the company in recent days. Looking back over the last 52 weeks, Energy Recovery, Inc. stock has a high of $16.67. Changes in price targets are not uncommon as analysts and brokerage firms will re periodic updates after beginning or initiating coverage.

Yesterday Energy Recovery, Inc. (NASDAQ: ERII) shares last traded at $10.72, which is a drop of $0.01 compared to the previous closing price. Opening at $11.01, they ranged from $10.50 and $11.02 throughout the day.

Energy Recovery, Inc. (NASDAQ: ERII) currently has a market cap of 561.20M.

Energy Recovery, Inc. (NASDAQ: ERII) Average Daily Trading Volume

54,439 shares crossed the trading desk yesterday, 73 percent below the norm, out of a total float 49,501,000. lower than normal. Look for trading volume to pick up in the coming days as momentum traders often use swings in trading volume to identify heavy volume accumulation or distribution by institutional investors.

As with all potential breakouts, investors look for volume to be at least 40%-50% higher than normal on the breakout to show that fund managers and other professional investors are jumping in.

Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.

These instituitional investors have substantial teams of analysts that investigate thousands of stocks, so it is good confirmation to see them taking a postion in a stock you’re researching.

Energy Recovery, Inc. (NASDAQ: ERII) Moving Averages

A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.

This is because the average acts like a floor (support), so the price bounces up off of it.

In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.

By spotting trends, moving averages allow investors to make those trends work in their favor and increase the number of successful trades.

With that in mind, Energy Recovery, Inc. (NASDAQ: ERII) now has a 50-day MA of $11.10 and 200-day MA of $11.85. It has traded in a 52-week range between $5.28 – 16.67 and today’s last price is 35.69%% lower than the 52 week high of $16.67.

Indeed, earnings growth is among the most crucial things to look at in regards to stock investing and, accordingly, investors seek companies that have raised their earnings by at least 25% for 3 consecutive years.

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