Restoration Company Valuation
29 valuation methods · 43 industries · Results in under 10 minutes
In short
A restoration company is usually valued on seller's discretionary earnings from a typical year, not a storm year. VA values service agreements as their own layer, and buyers check whether insurance programs and referral sources stay with the company.
Who this is for
Owners of water, fire, mold and storm damage restoration and mitigation companies preparing to sell, bring in a partner or plan succession, and buyers who need storm-driven earnings separated from the work that comes every year.
How is a restoration company valued?
VA values an owner-run restoration company on seller's discretionary earnings: EBITDA plus the owner's pay, because a buyer replaces the owner. Service agreements with property managers and commercial customers are valued as their own layer, at a higher multiple than one-off work, and that multiple rises with the share of customers who renew. Mitigation and reconstruction work is valued at a lower multiple that rises with the company's size and falls as work for new construction takes a larger share. Comparable companies, precedent transactions and a discounted cash flow check the result, and an asset floor keeps it above what the company's own assets would recover. This tool is informational only. Output is driven by your inputs and does not constitute a formal appraisal or certified valuation. Enter earnings for a typical year rather than a storm year: the model values the earnings it is given.
What drives the value of a restoration company?
- Earnings in a typical year, separate from years lifted by storms or floods
- Insurance carrier programs and third-party administrator panels, and whether they transfer to a buyer
- Referral sources such as plumbers, property managers and agents, and how many there are
- Certified technicians, and how long they stay
- Collections: how long insurers take to pay and how much of each invoice they cut
- Service agreements with property managers that bring in work every year
What lowers the value of a restoration company?
- Earnings from a storm year presented as a normal year
- Insurance programs or panels that are tied to the owner
- Slow collections and large invoice reductions
- A few referral sources bringing in most of the work
How much is a restoration company worth? A worked example
A typical year against a storm year
A restoration company with $5 M of revenue, $700 K of EBITDA in a typical year and $180 K of owner pay has $880 K of seller's discretionary earnings. Service agreements bring in 5% of revenue and 70% of those customers renew. The trades model values the agreement share of earnings at 4.4× and the rest at 3×, about $2.7 M before debt. Enter a storm year's $1.2 M of EBITDA instead and seller's discretionary earnings pass the model's size step, the multiples rise to 5.15× and 3.75×, and the value nearly doubles to about $5.27 M.
Illustrative figures from the industry model alone. A full report blends it with a discounted cash flow, comparable companies and precedent transactions.
Value your restoration company in under 10 minutes
- 1.Upload your financial statements, or type the figures in.
- 2.Confirm the add-backs and the industry details the model asks for.
- 3.Get a valuation range, the methods behind it and a PDF memorandum.
Which numbers matter most?
Seller's discretionary earnings
EBITDA plus the owner's own pay and perks. VA uses the pay you enter; for a small owner-run company with no figure entered, it estimates a working owner's salary.
Agreement revenue
Revenue under service agreements with property managers and commercial customers. VA values it as its own layer, separate from one-off jobs.
Contract renewal rate
The share of agreement customers who renew each year. The multiple on the recurring layer rises with it.
Days to collect
How long insurers and customers take to pay. Buyers read it with invoice reductions to see how much of billed revenue turns into cash.
Program and panel share
The part of revenue that comes through insurance programs and administrator panels. Buyers check whether those relationships stay with the company.
What do you need to value a restoration company?
- Profit and loss statements and balance sheets, ideally for the last three years
- Figures for the current year to date
- A list of add-backs: the owner's pay and perks, and any one-off costs
- Loan and lease balances
- Revenue and earnings by year, so a storm year can be told from a typical one
- Revenue by source: insurance programs, panels, referrals and agreements
- Collections by payer, and the owner's own pay
Example scenarios
A storm year
A restoration company had its best year after a major storm. The model values the earnings it is given, so entering the storm year as normal would overstate the value; the worked example shows by how much.
Panels that do not transfer
A company gets much of its work through an insurer's program that is tied to the owner. The model values the earnings entered, and a buyer will discount the part that may not follow the business.
Further reading
How to Value an HVAC Business in 2026: SDE and EBITDA Multiples
HVAC businesses sell for about 2x to 3.3x SDE for small shops and 5x to 9x EBITDA for larger firms. See 2026 multiples by size and what drives the number.
Is a Business Worth 3 Times Profit? When It Is 2x, When It Is 5x, and Which Profit Counts
Is a business worth 3 times profit? Often, if the profit is SDE. When 2x or 5x applies instead, which profit counts, and what diligence does to the price.
How Much Is a Business Worth With $500,000 in Sales? The Revenue Ladder From $100K to $3 Million
Revenue does not set a price, earnings do. See what businesses at $100K, $200K, $300K, $500K, $1M, $2M and $3M in sales are worth at 10%, 20% and 30% margins.
Frequently asked questions
How is a restoration company valued?
On seller's discretionary earnings, EBITDA plus the owner's pay, from a typical year. Service agreements with property managers are valued as their own layer at a higher multiple than one-off jobs.
How should I handle a storm year?
Enter earnings for a typical year. The model values the earnings it is given, and a storm year entered as normal can also move the company into a higher size band, so it overstates the value twice.
Do insurance program and panel relationships transfer?
Some do and some are tied to the owner. They do not change the model's multiple, but buyers check them closely, because they often bring in much of the work.
Do slow insurance payments lower the value?
They tie up cash, and invoice reductions cut earnings. The model values the earnings you enter, so enter what was actually collected rather than what was billed.
What if I pay myself less than a manager would cost?
Seller's discretionary earnings add back your own pay, so the level you pay yourself does not change that figure. A buyer who hires a manager will still look at EBITDA after a market salary, which is why the EBITDA-based checks are shown too.
Is this a certified appraisal?
No. This is an informational estimate. A bank loan, a partner buyout or an estate matter may require a certified business appraisal, which this does not replace.
Terms used on this page
- Seller's discretionary earnings (SDE)
- EBITDA plus the owner's own pay and perks. It shows what the business earns for one owner who works in it, and it is the figure most buyers of small owner-run businesses price.
- Add-backs
- Costs added back to reported earnings because a new owner would not bear them: personal expenses run through the business, one-off costs, or owner pay above what the role would cost to fill.
- Recurring revenue
- Revenue that repeats without a new sale, such as maintenance agreements, service plans or contracts customers renew.
- Renewal rate
- The share of customers on agreements or plans who renew each year.
- Valuation multiple
- The number earnings are multiplied by to reach a value. It rises with how durable the earnings are and how easily a new owner can keep them.
As featured in
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Last reviewed September 25, 2026 against VA's valuation models.