Enter a value in each field to calculate a result.
Key takeaways
- Enter the earnings and multiples yourself; the tool does not supply a current market range.
- Use comparable evidence based on the same earnings definition.
- Negative or unsupported earnings require a different analysis than this simple model.
What calculation does the tool perform?
The lower scenario equals annual normalized earnings multiplied by the lower assumed multiple. The upper scenario uses the upper multiple. The lower multiple cannot exceed the upper multiple. Earnings must be positive for this simplified model.
The tool does not decide whether your inputs represent SDE, EBITDA, owner benefit, or another measure. Record that definition yourself and use a multiple supported by comparables with the same definition. Mixing an owner-benefit number with an EBITDA multiple is not a harmless shortcut.
Why are the fields initially blank?
A default multiple can look like a recommendation even when labeled approximate. You must enter the multiple yourself. The tool cannot supply a verified current market benchmark. A historical public article can explain methods without establishing a 2026 local valuation range. (Source: Henry Schein: Valuation methods (2019).)
| Input | Evidence to establish first |
|---|---|
| Normalized annual earnings | A bridge from reported profit to accepted adjustments and replacement costs |
| Lower multiple | Relevant market evidence with matching earnings and transaction scope |
| Upper multiple | A defensible alternative assumption, not a desired price divided by earnings |
What does an illustrative range mean?
If an invented scenario uses $200,000 of earnings and assumed multiples of 3 and 4, the arithmetic produces $600,000 and $800,000. The example does not suggest those multiples fit dental practices generally or a particular buyer. The range simply describes what the chosen inputs produce.
A buyer can disagree with earnings, the multiple, asset scope, payment structure, or all of them. Identify which disagreement drives the result instead of treating the model output as an authoritative number.
What does this valuation calculator omit?
It does not appraise equipment, property or goodwill. It also does not value receivables, debt, working capital or payments that depend on future events. It does not test the buyer's repayment capacity or clinical ability to replace the seller. It does not model taxes, deal expenses or retained equity risk. Do not add asset values to the result without confirming what the multiple already includes.
This simple model may not fit weak or negative earnings. It may also fail when earnings cannot be checked or depend heavily on the owner. An asset analysis, turnaround scenario or other professional valuation approach may be needed. A blank or rejected calculation is better than a precise number built on the wrong method.
What should you record with each scenario?
Save the earnings definition, reporting period, adjustment schedule, source of the multiple assumptions and assets included. A range is difficult to evaluate without those details. State whether earnings are before owner pay. A figure after paying a replacement dentist uses a different cost basis.
Change one assumption at a time to identify its effect. First hold the earnings figure constant and compare the supplied multiples. Then hold a multiple constant and examine an earnings adjustment supported by diligence. This shows whether the gap comes from earnings or from the price assigned to those earnings.
| Assumption | Question before relying on it |
|---|---|
| Earnings | Can another reviewer reproduce the figure from source financials? |
| Replacement work | Does the model fund the labor needed after closing? |
| Multiple | What relevant evidence supports this particular assumption? |
| Included assets | Are property, receivables and operating equipment treated consistently? |
Do not average incompatible estimates to create an apparently balanced conclusion. A collections method and an earnings method can offer different views. Check the evidence and purpose behind each one. A formal analyst should explain how the methods are reconciled.
If you receive an actual offer, compare its payment conditions and asset boundary with the scenario. Retained equity, an earn-out or seller financing should not silently be treated as immediate cash. The rollover-equity guide helps identify the separate investment questions. Read the full offer even if its price falls within the range. Payment terms can change the decision.
What should happen after the calculation?
Read the main valuation guide, retain your assumptions with their source dates, and identify the evidence still missing. A discussion with Jason can clarify the commercial question. Use a qualified valuation professional when a formal appraisal or specific standard is required.
What makes a scenario ready to discuss?
Write the source of each input beside the result. For earnings, keep the original accounts and a line-by-line list of changes. Name the work the owner performs and how that work is treated. For the multiple, record the source date and why the evidence fits the type of buyer and assets in this case.
If you do not yet have support for an input, mark it as an assumption to test. A low and high number can look like a measured range even when both are guesses. Keep that distinction clear when sharing the output.
Bring the open questions to the valuation discussion. The next step may be to check a cost, define the asset scope or seek better deal evidence. Changing the number until it matches a desired price does not resolve the missing evidence.
Frequently asked questions
Why is there no suggested EBITDA multiple?
The site has not verified a current closed-deal database appropriate to every reader. You must supply a multiple that fits the evidence and earnings definition.
Can I use collections as the earnings input?
Not without changing the meaning of the model and using evidence for that measure. This tool is presented as a normalized-earnings scenario, and the valuation guide explains the distinction.
Does the range include real estate?
The tool does not determine asset scope. Establish what the comparable multiple includes and analyze property separately when appropriate.
Is this a broker opinion of value?
No. It is arithmetic on user assumptions. An opinion of value requires evidence, purpose, scope and judgment.
Sources
Retrieval dates appear beside each source. Figures retain their stated observation years; retrieval does not make older data current.
- Henry Schein: Valuation methods (2019) · Retrieved