Calculator
Valuation calculator
Turn a seller's stated SDE into earnings you can defend, then see what a range of multiples implies and how the asking price compares.
How it works
Adjusted earnings = stated SDE − unsupported add-backs − replacement compensation − annual capex reserve.
Value range = adjusted earnings × your low and high multiples.
Real multiple of the asking price = asking price ÷ adjusted earnings. If this is far above the multiple on the listing, the gap is the value of the add-backs and costs the listing left out.
Leave replacement compensation at zero only if you are comparing to listings that also exclude it. For deciding what to pay, include a fair wage for whoever will run the business. The multiples are yours to choose; this calculator does not suggest them. See How to value a small business.