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HVAC Business Valuation Calculator (SDE × Multiple)

Most small HVAC shops are priced on what the business earns for one owner: Seller's Discretionary Earnings, or SDE. Add back your own pay and the costs a buyer won't have, then multiply by a range to see a ballpark value — and what moves it.

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Example numbers — replace with yours. The starting values are placeholders so the form isn't empty. They are not industry averages or benchmarks — including the multiples.

Your last full year

Add-backs

Multiple range

Recurring revenue (optional)

Seller's Discretionary Earnings

Total add-backs —
Seller's Discretionary Earnings (SDE) —
SDE margin (SDE ÷ revenue) —
Net profit margin, for comparison —

Value range

Low end —
High end —
Midpoint —
Value as a % of revenue —
Recurring (member) revenue —

The math

—

How it works

  • SDE = net profit + owner salary, draws & benefits (one owner) + personal expenses paid by the business + one-time costs + interest, depreciation & amortization. It's the cash one full-time owner-operator could take out in a year.
  • SDE margin = SDE ÷ revenue. It lets you compare earning power across shops of different sizes.
  • Value range = SDE × low multiple to SDE × high multiple.

What multiple should you use?

We don't quote an industry multiple here, because we haven't found a solid public primary source for HVAC. Multiples vary with the size of the business, the local market, how much of the revenue is recurring, how much the business depends on the owner, and the state of the books. Larger shops with a management team in place are often valued on EBITDA rather than SDE. For a real range, ask a business broker who sells service businesses or a CPA who does valuations — and treat anything you read online as a starting point, not a price.

What tends to move a multiple

  • Recurring revenue. Maintenance agreement members who renew give a buyer revenue they can count on, which usually supports a higher multiple.
  • Owner dependence. If every sale, estimate, and supplier relationship runs through you, a buyer is buying a job, not a business.
  • Clean, provable numbers. Add-backs a buyer can't verify from your records often get thrown out.
  • Team and systems. Techs who stay, written processes, and a full schedule all lower a buyer's risk.

Things this leaves out

  • Working capital, debt, and real estate. Deals are often priced cash-free and debt-free, with inventory, trucks, or a building handled separately.
  • Deal terms. Seller financing, earn-outs, and how much is paid at closing change what a price is really worth to you.
  • Taxes. What you keep after a sale depends on how the deal is structured. Talk to a CPA before you sign anything.

This is a rough, educational estimate — not an appraisal, a valuation opinion, or tax or legal advice.

Where to get your numbers

The guide The HVAC KPIs Every Shop Owner Should Track (2026) covers net profit and the other numbers a buyer will look at. The anonymous Owner Numbers survey lets owners compare against real peers.

Related tools

Want more recurring revenue? The HVAC maintenance agreement calculator shows what a plan earns per member and how the member base grows. Want a higher SDE? The HVAC break-even hourly rate calculator and the markup vs margin & flat-rate price calculator show whether your prices leave the profit you need, the HVAC marketing ROI calculator shows what each new customer costs, the HVAC technician turnover cost calculator shows what losing a tech costs, and the HVAC revenue goal calculator turns a growth target into jobs and calls per day.