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Earnings Multiplier Business Valuation
Earnings Multiplier Business Valuation
Earnings Multiplier Business Valuation
Estimate your business value using the Earnings Multiplier method.
Financial Inputs
Valuation Results
Adjusted Net Profit (SDE):
$0.00
Estimated Business Value:
$0.00
Earnings Multiplier Business Valuation Tool
This Earnings Multiplier Business Valuation tool helps you quickly estimate the value of a business by calculating its Seller’s Discretionary Earnings (SDE) and applying an appropriate industry-specific multiplier. SDE represents the total financial benefit a single owner-operator would receive from the business, making it a common metric for valuing small to medium-sized businesses.
How to Use:
Enter Financial Inputs: Fill in your business’s Net Profit and “add-backs” such as Owner’s Salary, Perks/Benefits, Depreciation, Amortization, Interest Expense, and Income Tax. These figures are typically found on your company’s income statement and tax returns. Sample data is pre-filled for your convenience.
Select Industry Type: Choose an industry from the dropdown menu that best matches your business. This will automatically suggest a common earnings multiplier for that sector.
Adjust Earnings Multiplier (Optional): The suggested multiplier is a benchmark. You can adjust this value based on specific factors of your business (e.g., strong growth, high customer retention, low owner reliance might warrant a higher multiplier).
Calculate Valuation: Click the “Calculate Valuation” button to see your Adjusted Net Profit (SDE) and the Estimated Business Value.
Reset: Use the “Reset” button to clear all inputs and return to the default sample data.
Disclaimer
These tools are meant to provide quick, general insights, not exhaustive advice. They should not replace professional consultation or in-depth analysis. Users are encouraged to verify information and seek expert guidance before making decisions.
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