Hi,
New to this thread and have learned a lot from members. I've searched and read all the existing threads related to valuing SS businesses, but thought I'd try my luck with getting advice from the community on fair value for the following SS I'm looking to acquire:
* Annual revenue: $400K (has been growing 5% annually prior 3 years and this year forecasted at 10%+ driven by price increase)
* Operating Income: $240K (60% margin. Seller is reporting closer to 68% SDE, but I want to value it based on 60% assumption)
* Tax assessment property value at ~$970K ($330K land and $640K structure)
Property and equipment are well maintained. Owner was very hands and actively managing the business.
I know the 3-5X gross income and various guidance on NOI multiple (up to 6-8x). Owner is asking for the top end of multiples, but I want to figure out what's a range that I should be comfortable with / walk away price (knowing that ultimately the market will set the clearing price).
(I've been doing my diligence to validate numbers - counting cars, etc, but for this thread let's assume all the numbers are accurate)
Thanks!
New to this thread and have learned a lot from members. I've searched and read all the existing threads related to valuing SS businesses, but thought I'd try my luck with getting advice from the community on fair value for the following SS I'm looking to acquire:
* Annual revenue: $400K (has been growing 5% annually prior 3 years and this year forecasted at 10%+ driven by price increase)
* Operating Income: $240K (60% margin. Seller is reporting closer to 68% SDE, but I want to value it based on 60% assumption)
* Tax assessment property value at ~$970K ($330K land and $640K structure)
Property and equipment are well maintained. Owner was very hands and actively managing the business.
I know the 3-5X gross income and various guidance on NOI multiple (up to 6-8x). Owner is asking for the top end of multiples, but I want to figure out what's a range that I should be comfortable with / walk away price (knowing that ultimately the market will set the clearing price).
(I've been doing my diligence to validate numbers - counting cars, etc, but for this thread let's assume all the numbers are accurate)
Thanks!