You can find in the table below the EBITDA multiples for the industries available on the Equidam platform. The data is based on the annual estimate provided by Prof. Aswath Damodaran of the New York University for 2024.
EBITDA is an acronym that stands for earnings before interest, tax, depreciation, and amortization. EBITDA multiples are one of the most commonly used business valuation indicators that is often used by investors or potential buyers to assess a company’s financial performance. The EBITDA multiple will depend on the size of the subject company, its profitability, its growth prospects, and the industry in which it works.
WARNING: use with caution
Originally just a valuation solidity check, multiples have become a popular approach to value young, fast growing companies. The simplicity of this approach leads many practitioners to apply it uncritically to compute valuations. This might generate biased results failing to represent the fair value of a company.
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| Industry | EBITDA Multiple |
| Advanced Medical Equipment & Technology | 21.66 |
| Advertising & Marketing | 11.94 |
| Aerospace & Defense | 17.91 |
| Agricultural Chemicals | 12.47 |
| Airlines | 8.42 |
| Airport Operators & Services | 8.42 |
| Aluminum | 7.82 |
| Apparel & Accessories | 13.19 |
| Apparel & Accessories Retailers | 11.71 |
| Appliances, Tools & Housewares | 15.55 |
| Auto & Truck Manufacturers | 9.84 |
| Auto Vehicles, Parts & Service Retailers | 11.19 |
| Auto, Truck & Motorcycle Parts | 8.55 |
| Banks* | 17.98 |
| Biotechnology & Medical Research | 15.32 |
| Brewers | 13.89 |
| Broadcasting** | 7.87 |
| Other Broadcasting | 7.87 |
| Cable Service Providers | 7.88 |
| Radio Broadcasting | 7.87 |
| Television Broadcasting | 7.87 |
| Business Support Services** | 15.19 |
| Call Center Services | 15.44 |
| Cleaning Services | 15.44 |
| Commercial Educational Services | 10.92 |
| Corporate Accounting Services | 15.44 |
| Data Processing Services | 15.44 |
| Exhibition & Conference Services | 15.44 |
| Health, Safety & Fire Protection Equipment | 9.43 |
| Industrial Design Services | 15.44 |
| Industrial Equipment Rental | 15.44 |
| Legal Services | 15.44 |
| Maintenance & Repair Services | 15.44 |
| Management Consulting Services | 15.44 |
| Office Equipment & Supplies Rental | 15.44 |
| Office Furniture | 9.43 |
| Office Supplies | 9.43 |
| Office Supplies Wholesale | 9.43 |
| Pest Control Services | 15.44 |
| Security Services | 15.44 |
| Testing Laboratories | 15.44 |
| Transaction & Payment Services | 15.44 |
| Translation & Interpretation Services | 15.44 |
| Other Business Support Services | 15.44 |
| Other Business Support Supplies | 9.43 |
| Business Support Supplies | 9.43 |
| Casinos & Gaming | 15.09 |
| Closed End Funds | 16.81 |
| Coal | 4.07 |
| Commercial Printing Services | 12.2 |
| Commercial REITs | 21.66 |
| Commodity Chemicals | 12.71 |
| Communications & Networking | 14.28 |
| Computer & Electronics Retailers | 11.71 |
| Computer Hardware | 18.66 |
| Construction & Engineering | 9.4 |
| Construction Materials | 11.51 |
| Construction Supplies & Fixtures | 10.17 |
| Consumer Lending* | 17.98 |
| Consumer Publishing | 12.2 |
| Corporate Financial Services* | 17.98 |
| Courier, Postal, Air Freight & Land-based Logistics | 13.1 |
| Department Stores | 15.61 |
| Discount Stores | 11.84 |
| Distillers & Wineries | 13.89 |
| Diversified Chemicals | 7.98 |
| Diversified Industrial Goods Wholesalers | 8.93 |
| Diversified Investment Services | 16.81 |
| Diversified Mining | 7.82 |
| Diversified REITs | 21.66 |
| Drug Retailers | 11.71 |
| Electric Utilities | 9.86 |
| Electrical Components & Equipment | 15.55 |
| Electronic Equipment & Parts | 15.55 |
| Employment Services | 15.44 |
| Entertainment Production | 15.78 |
| Environmental Services & Equipment | 14.04 |
| Exchange-Traded Funds | 16.81 |
| Financial & Commodity Market Operators & Service Providers | 28.48 |
| Fishing & Farming** | 9.75 |
| Agricultural Biotechnology | 9.75 |
| Agricultural Consultancy Services | 9.75 |
| Agriculture Support Services | 9.75 |
| Animal Breeding | 9.75 |
| Animal Feed | 9.75 |
| Aquaculture | 9.75 |
| Cattle Farming | 9.75 |
| Coffee, Tea & Cocoa Farming | 9.75 |
| Commercial Fishing | 9.75 |
| Commercial Nurseries | 9.75 |
| Fishing & Farming Wholesale | 9.71 |
| Fur Farming | 9.75 |
| Grain (Crop) Production | 9.75 |
| Hog & Pig Farming | 9.75 |
| Organic Farming | 9.75 |
| Poultry Farming | 9.75 |
| Sheep & Specialty Livestock Farming | 9.75 |
| Sugarcane Farming | 9.75 |
| Vegetable, Fruit & Nut Farming | 9.75 |
| Other Fishing & Farming | 9.75 |
| Food Processing | 12.15 |
| Food Retail & Distribution** | 9.35 |
| Beer, Wine & Liquor Stores | 9.29 |
| Food Markets | 9.29 |
| Food Wholesale | 9.71 |
| Supermarkets & Convenience Stores | 9.29 |
| Tobacco Stores | 9.29 |
| Vending Machine Providers | 9.29 |
| Other Food Retail & Distribution | 9.29 |
| Footwear | 17.31 |
| Forest & Wood Products | 10.15 |
| Gold | 8.81 |
| Ground Freight & Logistics | 9.98 |
| Healthcare Facilities & Services | 12.44 |
| Heavy Electrical Equipment | 15.55 |
| Heavy Machinery & Vehicles | 14.74 |
| Highways & Rail Tracks | 13.31 |
| Home Furnishings | 9.74 |
| Home Furnishings Retailers | 12.92 |
| Home Improvement Products & Services Retailers | 12.92 |
| Homebuilding | 8.03 |
| Hotels, Motels & Cruise Lines | 15.09 |
| Household Electronics | 11.44 |
| Household Products | 15.11 |
| Independent Power Producers | 8.71 |
| Industrial Conglomerates | 8.93 |
| Industrial Machinery & Equipment | 14.74 |
| Insurance Funds | 16.81 |
| Integrated Oil & Gas | 5.33 |
| Integrated Telecommunications Services | 6.88 |
| Investment Banking & Brokerage Services* | 17.98 |
| Investment Holding Companies | 16.81 |
| Investment Management & Fund Operators | 16.81 |
| Iron & Steel | 6.9 |
| IT Services & Consulting | 14.68 |
| Leisure & Recreation** | 11.79 |
| Adventure Sports Facilities & Ski Resorts | 11.79 |
| Amusement Parks and Zoos | 11.79 |
| Golf Courses | 11.79 |
| Guided Tour Operators | 11.79 |
| Gyms, Fitness and Spa Centers | 11.79 |
| Hunting & Fishing | 11.79 |
| Marinas | 11.79 |
| Movie Theaters & Movie Products | 11.79 |
| Museums & Historic Places | 11.79 |
| Professional Sports Venues | 11.79 |
| Public Sport Facilities | 11.79 |
| Theatres & Performing Arts | 11.79 |
| Travel Agents | 11.79 |
| Other Leisure & Recreation | 11.79 |
| Life & Health Insurance | 7.22 |
| Managed Healthcare | 11.06 |
| Marine Freight & Logistics | 6.12 |
| Marine Port Services | 6.12 |
| Medical Equipment, Supplies & Distribution | 20.07 |
| Mining Support Services & Equipment | 7.82 |
| Miscellaneous Specialty Retailers | 11.71 |
| Multiline Insurance & Brokers | 8.14 |
| Multiline Utilities | 9.86 |
| Mutual Funds | 16.81 |
| Natural Gas Utilities | 9.86 |
| Non-Alcoholic Beverages | 17.27 |
| Non-Gold Precious Metals & Minerals | 8.81 |
| Non-Paper Containers & Packaging | 9.29 |
| Office Equipment | 9.43 |
| Oil & Gas Drilling | 6.44 |
| Oil & Gas Exploration and Production | 4.22 |
| Oil & Gas Refining and Marketing | 8.65 |
| Oil & Gas Transportation Services | 8.65 |
| Oil Related Services and Equipment | 6.44 |
| Online Services** | 20.44 |
| Content & Site Management Services | 20.44 |
| E-commerce & Marketplace Services | 20.44 |
| Internet Gaming | 20.44 |
| Internet Security & Transactions Services | 20.44 |
| Search Engines | 20.44 |
| Social Media & Networking | 20.44 |
| Other Online Services | 20.44 |
| Paper Packaging | 9.29 |
| Paper Products | 10.15 |
| Passenger Transportation, Ground & Sea | 13.1 |
| Pension Funds | 16.81 |
| Personal Products | 20.07 |
| Personal Services** | 14.94 |
| Accounting & Tax Preparation | 15.44 |
| Child Care & Family Services | 15.44 |
| Consumer Goods Rental | 15.44 |
| Consumer Repair Services | 15.44 |
| Funeral Services | 15.44 |
| General Education Services | 10.92 |
| Personal Care Services | 15.44 |
| Personal Legal Services | 15.44 |
| Other Personal Services | 15.44 |
| Pharmaceuticals | 14.6 |
| Phones & Handheld Devices | 14.16 |
| Professional Information Services | 11.38 |
| Property & Casualty Insurance | 9.25 |
| Real Estate Rental, Development & Operations | 13.21 |
| Real Estate Services | 16.5 |
| Recreational Products | 11.79 |
| Reinsurance | 8.52 |
| Renewable Energy Equipment & Services | 13.95 |
| Renewable Fuels | 13.95 |
| Residential REITs | 21.66 |
| Restaurants & Bars | 16.48 |
| Semiconductor Equipment & Testing | 19.32 |
| Semiconductors | 20.98 |
| Shipbuilding | 6.12 |
| Software | 28.48 |
| Specialized REITs | 21.66 |
| Specialty Chemicals | 12.47 |
| Specialty Mining & Metals | 7.82 |
| Textiles & Leather Goods | 13.19 |
| Tires & Rubber Products | 6.94 |
| Tobacco | 9.33 |
| Toys & Children’s Products | 11.79 |
| UK Investment Trusts | 16.81 |
| Uranium | 8.71 |
| Water & Related Utilities | 12.67 |
| Wireless Telecommunications Services | 7.37 |
*For these industries, a higher level business sector multiple is applied
**For these industries, a lower activity-based level is available
Appreciate the valuable insights.
Could you please advise which category (with the respective EV/EBITDA and EV/Revenue multiples) would be appropriate for a drugs wholesaler in Europe?
Hi Denitsa,
Thanks for getting in touch!
Assuming the company you are looking at doesn’t actually do any drug development themselves (in which case ‘Pharmaceuticals’ would be the right category), then ‘Medical equipment, supplies & distribution’ would be a fitting category to look at here.
Best regards,
Dan
This article on EBITDA multiples by industry is incredibly valuable for understanding valuation benchmarks. It’s especially helpful for comparing industries and making more informed business decisions. Thanks for breaking down a complex topic so clearly!
Your detailed analysis of EBITDA multiples across TRBC industries was incredibly enlightening. I’ve always found industry valuations challenging to understand, but your clear explanations and thorough breakdowns made it so much more approachable. This is definitely a resource I’ll be coming back to. Thanks for sharing such valuable insights!
These are got to be the dumbness multiples ever. We acquire in the space, and no way have we ever seen such high multiples, especially in Finance services/accounting. Do you even know how to do M&A?
Hi Macus,
As explained at the top of the article, and elsewhere in the comments here, these are actual EBITDA multiples based on analysis of real public company financials.
I should also explain that EBITDA multiples (and multiples, generally) are most useful when applied as part of a competent calculation, and even then they should be one component in a more comprehensive methodology. This may include considerations for discount rate, illiquidity, survival rates, required ROI, etc.
Relative valuations (valuation by multiple) have their use, and they also have limitations. There’s a good presentation from Professor Aswath Damodaran on this topic, available here: https://pages.stern.nyu.edu/~adamodar/pdfiles/country/relvalAIMR.pdf
Best regards,
Dan
Hi there- I’m a 15 year veteran business broker and M&A advissor in california. We value businesses utilizing a 3rd party CERTIFIED appraiser and SBA lending officers validate pricing. Help me understand – you are based in the Netherlands, and are claiming your “multiples” do not change with size of firm? Its nothing like we see based on solid information from US based companies like GC Data or Peer comps or BizBuy Sell comps. Your EBITDA multiples are about 5-10 times more than what a normal valuation or “sold” comp would normally be. Would love to hear your “sources”. If its just for businesses that are 50M or higher- its important to set realistic expectations for real entrepeneurs who are working with real buyers. Look forward to your response.
Hi Amy,
Thanks for getting in touch! Happy to help with this.
The multiples are based on analysis of public companies, globally, by Professor Aswath Damodaran of NYU Stern. Some of our rationale for using public company multiples is explained here:
https://www.equidam.com/advanced-multiples-the-tools-of-valuation-professionals-at-your-fingertips/
Exactly how these multiples apply to a valuation will depend on the methodology being used. Our methodology combines five different perspectives on value, two of which use multiples in the calculation. If you would like to read more about that, you can find a detailed breakdown in our methodology paper here:
https://www.equidam.com/methodology/
Best regards,
Dan
Are these global multiples or specific to the US?
These are multiples based on public companies, worldwide.
Please specify whether these multiples are forward-looking or trailing? In other words, does Damodaran use the expected EBITDA for the next financial year, or factual EBITDA for the last financial year for the calculation of multiples?
Thx,
Alex
Hi Alex, thanks for the question!
These are multiples based on the trailing EBITDA.
Can you be more specific regarding EBITDA multiple as it relates to in-home personal care giving services? Any difference in multiple paid between Medicaid only service providers and private pay?
Hi Seth
These multiples are based on analysis of public companies from all over the world, so unfortunately we don’t have data on the influence on Medicaid.
Best regards,
Dan
Hi Dan,
What is the multiple for Home Health care and a Health staffing agency? Your assistance is greatly appreciated
Hi Jen,
Apologies for the slower than usual response here! The EBITDA for Home Healthcare is 12.44. I don’t have a specific multiple for Health Staffing Agencies, but I imagine it may be similar. Happy to try and dive into that deeper if you can provide some more detail.
Best regards,
Dan
HI there!
EBITDA multiple from this database are forward-looking (are calculated using 2024 EBITDA as denominator) or backward-looking (are calculated using 2023 EBITDA as denominator)?
Regards,
Alex
Hi Alex, these are multiples based on the trailing EBITDA.
What is the EBITDA multiple ratio for India, Pakistan and East Asia?
Hi Fidan,
Thanks for getting in touch!
We use global averages for EBITDA multiples, as the regional differences are captured elsewhere in the calculation (for example, in the discount rate).
Best regards,
Dan
Thanks very much for this info, very useful. What would be a reasonable multiple for a small sized digital signage company( integrates LED screens to build the signage you see on the streets and shopping malls).
Thanks a lot!
Hi Phillip,
Thanks for the question! We have an EBITDA multiple of 11.94 for the “Signs & advertising specialty producers” industry subcategory, which seems like a good fit here.
Best regards,
Dan
Informative article
I have few queries
1. What is the impact of size of the company on ebitda multiple.
2. If a manufacturing company is running at lower capacities will it impact EBITDA multiple based on low capex for future growth.
3. Can you share multiples specific to India if possible?
Hi Anubhav,
Thanks for getting in touch!
The size of the company doesn’t influence the multiple in our methodology, as we use multiples to provide a stable, long-term perspective on the market. For the same reason, the multiple would not change based on the operation of a company either.
We use global averages for multiples, as the regional differences are captured elsewhere in the calculation (for example, in the discount rate).
Best regards,
Dan
Multipliers do not change depending on the size of the business? So a business with $750k EBITDA is the same multiplier that has $30 Million EBITDA?
Where is this data coming from? I think this is going to vastly mislead small business owners on what their businesses are worth.
You must be getting your data from extremely large businesses. Can you disclose the size of the businesses that this came from?
Hi James,
Thanks for the question, and happy to provide some clarity here.
The multiples are based on analysis of public companies, globally, by Professor Aswath Damodaran of NYU Stern.
You are quite right that a public company EBITDA multiple cannot be used as a single solution for valuation without context, and age of the company is also certainly a major consideration. If you want to see exactly how EBITDA multiples fit into our valuation methodology, you can take a look here:
https://www.equidam.com/methodology/
Best regards,
Dan
HOW ABOUT MACHINING INDUSTRY
Hi Walid,
As our industry categorisation (TRBC) is based on consumption rather than production, I would advise that you consider which industries you are mostly selling to. e.g. is most of your machining done for the auto industry? In which case that would be your selection.
Best regards,
Dan
Hello, which EBITDA multiples we can use for transportation logistics services company? we transport client’s goods from harbor to warehouse, thank you for your help
Hi Deandra,
We have an EBITDA multiple of 6.12 for the “Other Marine & Freight Logistics” industry subcategory, which seems like a good fit here.
I hope that helps!
Best regards,
Dan
I was wondering whether there is one for the fashion industry?
Hi there, thanks for the question!
We’ve got Apparel & Accessories listed here at 12.58, though in the Equidam platform you can find that broken down into a few more specific sub-categories.
Insightful breakdown!
It’s clear how crucial EBITDA multiples are in valuation discussions. I’m wondering, in your experience, how much weight do investors typically place on these multiples when evaluating opportunities within a specific industry?
Thanks for the question Steffie!
EBITDA multiples have become more popular in the last year or so, due to the reflection of financial health of a company. Measuring revenue alone can be a little one-dimensional in terms of perspective on value.
This is quite useful.
are these multiples global , Europe or US ?
Hi there, thanks for the question!
The multiples are based on global data.
Dear Dan,
Many thanks for the information provided.
I am looking for a EBITDA multiple for companies on copy rights management in the music industry. (Hipgnosis is an example)
In what sector are these type of firms found? Could you please help me?
Hi Marc, thanks for the question!
We have Copyright Management as a sub-category of Entertainment Production in the Equidam platform, so the 16.73 EBITDA multiple listed here would be a starting point for you!
Dear Dan, didn’t find a category telecommunication in your list. We have a an SME active in EU countries (Germany, Croatia) in the field of constructing & engineering of telecommunication (fixed and mobile) – data centres – power supply). What would be the best choice for EBITDA multipla for the quick evaluation, found in one post comment of 8,56, thx for the feedback and support, Berislav
Hi Berislav,
Thanks for the question! It sounds like you would fall under Telecommunications Network Infrastructure, which is a subcategory of Integrated Telecommunications Services – with an EBITDA multiple of 6.81
I hope that’s helpful!
Best regards,
Dan
Hello, great work Thank you ! What about the certification ‘companies ?
Hi Patrick,
This is an interesting one; my instinct is that you would pick the industry for which you are issuing certifications – as the growth/risk of that industry would be a factor in your own potential.
Happy to give this some deeper consideration if you can provide some more detail?
Best regards,
Dan
Thanks for much informative article. I need your support to know the price multiple of a bitcoin mining company with 50 MW hosting capacity. A swift response to this would be highly appreciated.
Hi Huram,
Unfortunately, as we use public company multiples in our research here, I’m not sure there’s enough available data to give you a helpful starting point.
That said you might be able to compile a list of the few comparable public companies and produce a useful average of their multiples. You can either do this directly on the Equidam platform, or via some manual research.
e.g. https://finbox.com/DB:1YT/explorer/ev_to_ebitda_ltm/
Hey Dan I had a query: what would be the typical multiple for an investment bank (m&a advisors)? Thanks
Hi Paolo,
According to the most recent update to our multiples, the Investment Banking sector has an average EBITDA multiple of 19.89.
I hope that helps!
An AI text to video SaaS company? We don’t sell to a particular industry, target mid sized companies to enterprise with sales teams, sometimes e-commerce.
Hi Ono,
Good question! Thanks for getting in touch.
Do you have a particular application that you think may be the most common? i.e. is this most likely to come out of companies’ marketing budgets?
In our case we target salespersons, so most common scenario is use the software to make video outreach.
Hi there,
Great data and very informative! I am trying to value a private company which has been in business for the last 20 years in the direct debit (BACS) market of the UK. The revenue of the company is around a million pound and EBIDTA is under 300. I was wondering in which category will it fall and what EBIDTA multiple should I be using? I will appreciate your a help a lot.
Cheers!
Hi Akshay, great to hear from you!
This is tricky one, as it’s not a sector I’m particularly familiar with. If your primary customers are Banks then I would suggest that as the best industry choice, otherwise perhaps Transaction & Payment Services?
Happy to look into this a bit further if you can provide some more context!
Which multiple would I place on a residential garbage company?
Hi Jose, thanks for the question.
We have ‘Waste Management, Disposal & Recycling Services’ under the umbrella industry of ‘Environmental Services & Equipment’ on our platform – that sounds like a good option for you.
Hi, thanks for the interesting information. I have a functional question: my company Shipstage is working on the development of logistics projects for the transportation and delivery of goods. Please, if you can, tell me in which section “Industry” I can find EBITDA Multiple for the “Logistics”?
Hi Colt, thanks for submitting the question! Happy to help.
There are three main categories for logistics companies, depending on where you are most focused:
Courier, Postal, Air Freight & Land-based Logistics (7.89)
Ground Freight & Logistics (7.18)
Marine Freight & Logistics (2.58)
I hope that’s helpful!
Thank you for your answer!
What would it be for a business with clients from industrial to manufacturing ,theaters ect. Anyone who is working above 4 ft and meeds to stay osha compliant. We are a fall protection safety business that offers, annual inspections, repairs, installation, consulting, traning and merchandise.
Thanks for the question, Bruce.
Your business seems to have a very broad application across the construction industry, so I think the best choice here would be ‘Construction & Engineering’. This reflects the fact that the growth potential and industry risk associated with Skyline Safety is fairly well correlated with the construction industry as a whole.
I hope that’s helpful!
Hello, how about architect services?
Hi Guspra, thanks for getting in touch!
There are two main industry categories which architects may fall under:
Construction & Engineering (8.56)
Homebuilding (5.03)
Which of those categories fits you best will depend on how much you specialise on the housing market in particular.
I hope that’s useful!
Thanks 🙂
What would industry would be for Tesla or Apple? Thanks.
Hi Will, thanks for the question!
Tesla would fall under ‘Auto & Truck Manufacturers’ (9.20). Apple is a bit harder to pin down as they have a number of significant revenue streams – from hardware to services – but probably best fall under ‘Computer & Electronics Retailers’ (10.56).
Hi, I’m looking at the EBITDA for construction & engineering in your list: 8.56x. The “Construction/Engineering” multiple from the NYU professor source list cites 13.17x. Could you perhaps explain how you came in so much lower? I think everyone in the comments/future readers would benefit from an example. Also, I can’t use your number until I understand its sourcing/calculation.
Many thanks in advance!
Hi Matt, thanks for the question!
The default multiples we provide are from Damodaran’s global dataset, which you can view here: https://pages.stern.nyu.edu/~adamodar/New_Home_Page/datacurrent.html
Hi,
Thanks for this extremely useful and helpful article. Just to clarify. You mentioned that your multiples are based on Professor Aswath Damodaran of NYU Stern on public companies. So does that mean that the multiples for small/mid sized privately held businesses would really transact for lower multiples than the publicly traded one in Damodaran’s database? And if that’s the case, do you know what the general RANGE of multiple for different size businesses are?
Hi Andrew, thanks for the comment!
We use public multiples as the default on Equidam (though you can add your own custom multiple) as they offer the most easily accessible and reliable multiples available. There are some downsides to this approach, too, which we addressed in the article about our Advanced Multiples feature, here:
https://www.equidam.com/advanced-multiples-the-tools-of-valuation-professionals-at-your-fingertips/
In general, younger companies should have a higher multiple than more mature companies, as the valuation reflects more intangible value rather than being purely a reflection of revenue or EBITDA. That said, there are close to no data sources available to reference private multiples. The discrepancy in value there is accounted for in part by how we weight the combination of methods:
https://www.equidam.com/methodology/
Hi,
I see here that gyms and spas here are valued at EBITDA multiple of 12.27. When I compare this to other sources online, they almost unanimously give you a range of 1 – 5 (depending on how large the business is).
How is the 12.27 justified against much smaller multiples proposed for such businesses (I’m sorry but the discrepancy is too large)? Does it apply to SMEs? Is it based on recent transactions?
Hi Harsh, great question!
There’s a few things to consider here. One is that the kind of ‘rule of thumb’ approach to valuing a gym you can find online – using 1-5x EBITA – is fairly crude. It’s looking at current EBITA for what are generally fairly small ‘lifestyle’ businesses.
The multiple used by Equidam, as explained in our methodology, is derived from public companies (think Planet Fitness), and valuations are geared towards companies with that kind of ‘venture backable’ ambition. That multiple is applied to terminal year EBITA with a significant discount rate which reflects the risk of early stage companies.
So in summary: we use higher multiples which reflect the potential scale of venture backed businesses, but the calculation also discounts the result heavily based on the risk involved of building a startup with ambitions on that scale.
You can read more about how this is calculated in our Methodology paper, here:
https://www.equidam.com/methodology/
Hi Brother,
under which category would a software company related to civil engineering come, a company which provides tools for builders to keep their materials in check.
Hi Ahmad,
Thanks for getting in touch! Happy to help.
With industry selection – for the purpose of finding a useful multiple – you should consider the risks and potential associated with the market you are selling into. So in the case of your company, choosing Building Contractors or Civil Engineers & Architects could be appropriate (depending on which is likely to be your main market) as your growth potential will be dependent on those industries.
I hope that helps!
Best regards,
Dan
Very helpful information. Under which category would you file personal care products, primarily mothers, babies, children and young families? Would it be Personal Products? Toys & Children’s?
Many thanks.
Hi Rod,
That answer probably depends on who the primary user of your products may be. ‘Children’s Products & Accessories’ would be a good fit if these are primarily designed to be used by or on children, though it seems like ‘Alternative Medicine Facilities’ might be more appropriate based on your product line?
Best regards,
Dan
Hi,
For aeriel advertisement.
for eg- for aerieal banneres, sky writing which multiple should one apply?
Hi Gauhar,
Thanks for the question! That’s a niche area, so it will always be tricky to get a precise multiple, but the Outdoor Advertising industry is probably a good representation.
I hope that helps!
Best regards,
Dan
These multiple are insane, no way it is accurate. I’m in the industry and have never seen such crazy numbers
Hi Marcus,
These multiples are the result of research by Professor Aswath Damodaran of NYU Stern on public companies. It is without doubt the industry benchmark, but if you have a conflicting source we’d be very happy to take a look.
Best regards,
Dan
Hi, I’m trying to appraise a shopfitting / road sign manufacturer in Eastern Europe. What EBITDA multiple should I use? Annual sales between $5-8M, net earnings ~$1-1.5M, EBITDA ~$1.5-2M, EBITDA/revenue ~22-25%. Thanks
Hi Bolek,
‘Signs & Advertising Specialty Producers’ under ‘Advertising & Marketing’ might be a good fit for you – which would imply a multiple of 10.55.
Best regards,
Dan
This is quite useful.
are these multiples global , Europe or US ?
Hi Michael,
The multiples are global. You can find more details on the multiples we use here:
https://support.equidam.com/en/articles/2065575-ebitda-multiple
I hope that’s helpful!
Best regards,
Dan
Whats the EBITDA for a Custom Audio Video Security company?
Hi Joseph, thanks for the question!
That would probably best fit ‘Security & Surveillance’, which falls under ‘Communications & Networking’, with an EBITDA multiple of 13.98.
Best regards,
Dan
Is there an EBITDA multiple for the Fencing industry, or only a more general multiplier for the construction industry?
Hi Thomas,
Thanks for getting in touch! Happy to help.
We don’t have a specific multiple for the fencing industry, though on the construction side there are maybe three options depending on exactly how you operate:
Construction & Engineering (for companies that do the construction themselves) – 8.56
Construction Materials (for companies that supply the raw materials for construction) – 9.66
Construction Supplies & Fixtures (for companies that provide finished products to be used in construction) – 10.01
I imagine you might fall into the last category if you supply finished fence panels to construction projects, and the former if you are doing the design and build from scratch.
I hope that’s useful!
Hi, i run a marketplace in the luggage’s deposit for tourists. I didn’t find a multiple that fit to my business. Can you help my find the right one?
Hi Antonio,
Thanks for getting in touch, and happy to help!
That’s definitely a niche industry, so you wont find anything too specific (unless you know of similar companies who have recently raised money and published a multiple alongside that). However, I suspect Other Leisure & Recreation is a reasonable compromise in terms of the market risks and potential it represents. That would give you an EBITDA multiple of 12.27, as of our latest parameters update.
Best regards,
Dan
Hi, thanks for the useful article
I was wondering what should be the multiple for a multi brand company with retail (boutique stores) and wholesale (franchisers) sales operation?
Thanks
Hi Dan,
Thanks for the question!
The main question to consider here is which industry category are you most exposed to in terms of market risks and market potential. For example, if the majority of your business is in the ‘Gyms, Fitness and Spa Centers’ category – aimed at wellness solutions or experiences, then you would want to look at the multiple there which is 12.27 as of our latest parameters update.
I hope that’s useful!
Best regards,
Dan
Hi there!
Is this including an earn-out phase?
Earn outs as with valuation and many other clauses are several parts of the deal that are all related to each other. As earn outs are very common in startup exists, the valuation should not need large adjustments for a common earn out schedule. However, these negotiations are very ad-hoc so large variance is common.
I hope that answers your question!
Hi, this was really helpful.
I am an MBA student and currently pursuing my project on Valuation of sports franchises (Indian Premier League)
Can you please help in determining which industry would that fall into? Or Sports franchises in general falls into?
Hi Adnan,
Thanks for getting in touch, interesting question!
This is a niche industry, but my suspicion would be that the business model (revenue generation) of a sports franchise is largely associated with the venue? e.g. ticket sales and merchandise sales on the premises.
If that’s the case, Professional Sports Venues would be a good choice. If you don’t think that’s the case, then it may require some further thought .
Best regards,
Dan
Hi,
Great article, thanks for sharing. I am a bit confused though. On Damodaran excel published on Jan’22 for the 2021 year (US companies), the EBITDA multiple for airlines is 17,6x whereas you put 24,89x (I took the one for EBITDA positive firms).
Also, how is it possible that this multiple for airlines was bigger in 2020 (published in Jan’21) -34,43x-? Since the airlines’ valuations dropped due to the 2020 Covid situation, also the multiples should be smaller.
Thanks a lot for the clarification
Hi Jorge, thanks for the questions!
In regard to your first question: we’re currently still operating with the 2021 multiples, as the 2022 update by Professor Damodaran introduced a significant amount of volatility. Our assumption here was that the market would cool down through 2022, which did indeed prove to be the case – fairly quickly. Still, we recognise that it isn’t an ideal solution, are working on a better solution to multiples.
In regard to your second question, we published a note with our last multiples update which touches on the increase for airlines:
https://www.equidam.com/parameters-update-p5-4-ebitda-multiples/
I hope that’s useful! Don’t hesitate to follow up if you have any further questions.
Best regards,
Dan
Hi, this approach used monthly/quarterly or annual ebitda?
Hi Erka,
Thanks for getting in touch! You can find all of the details of our methodology here: https://www.equidam.com/methodology/
Best regards,
Dan
Hello.
I’m looking for the EBITDA for the HVAC (Heating, Ventilation, Air Conditioning) Industry and I don’t see that named specifically in the list. Would if fall under a different category under your list. Thank you for the great work.
Hi Jon,
HVAC would be under the Water & Related Utilities industry if you are supplying to customers, and Electrical Components & Equipment if you in the value chain for HVAC unit production.
I hope that answers your question! Let us know if there’s anything else we can help with.
Best regards,
Dan
The multiples used on this site and Prof. Aswath Damodaran multiples seem off, by a little bit. I was looking at the US Value/EBIT & Value/EBITDA Multiples by Industry Sector by the professor. Also, there seems to be different industries names too.
Are you adding other factors to get your multiples? Am I looking at the wrong dataset?
Hi Jason,
Thanks for the comment, and the question!
Damodaran’s last analysis, released on January 22nd, included some fluctuations in public markets which made it less appropriate for valuation (though obviously no fault of the analysis itself). It also included the updated TRBC industry categories.
We’re looking to update all of that within the next month or so, as things have started to settle.
Hello, if I have a private owned in company with Ebidta equal Ebit which multiple I have to use ? The one for Ebit or Ebidta that I found in NYU report ? Plus, is it correct to use those reference for private company ? Or in principle i should reduce/increase the multiple since the company is private and the report is for for public ?
Hi Alessandro, thanks for your question!
We use public company EBITDA multiples for calculating valuation, as they are the most widely available and reliable. As a part of the calculations we also apply a discount rate (looking at risk free rate, industry beta, market risk premium) and an illiquidity discount based on stage of the company.
Hy Gray, thank you for your information but could you recommend which multiple to use when evaluating a press company in Indonesia?
I hope you will answer this question and sorry my english is so bad
Hi Sischa,
Happy to help! It would be useful to know with a bit more precision which industry might be most applicable to you. This guide might be a good start:
https://support.equidam.com/en/articles/2458541-which-industry-should-i-choose
Can i please get the multiplier for the Tech industry in Taiwan?
Hi Chisom,
Multipliers look at the growth potential of industries from a consumer perspective, so think ‘financial services’ rather than ‘fintech’ for example. I’d be happy to answer the question if you have a particular sector in mind.
Hello
May I reference this research in my templates is sell at https://finmodelslab.com?
Hi Henry, thanks for reaching out!
We’re very happy for you to use an excerpt and link back to us for the full set. It might also be worth making a note for your users that we keep the data on that page updated on a regular basis.
Hi!
First of all, thank you for very useful article!
Second of all, could you recommend which multiple to use when evaluating a company providing solutions for machinery&vehicles’ emissions reduction?
BR
Hi Lukas,
Thanks for your comment, and very glad to hear you found the article useful.
In regard to your question: unless you have a focus on machinery or vehicles in a particular industry then ‘Auto Vehicles, Parts & Service Retailers’ might be the most appropriate. If is more industry rather than consumer focused then ‘Heavy Machinery & Vehicles’ might be a better guide to the growth potential of your sector.
Hi there
I am looking for an appropriate valuation multiple for a media and events company (they stage online and in person events, curate events for Corporate clients as well host a successful podcast)
Can you help?
Hi Rob, many thanks for the question!
When looking at the growth potential of an events company, it’s worth considering whether it has a particular industry focus or takes a more sector agnostic approach.
If it’s the former, then it may be more likely to be influenced by the growth of the particular industry it serves, rather than just correlating with the events industry as a whole.
If it’s the latter, there are references to EBITDA multiples of between 10 and 13 for selected companies in the B2B events space, which you might want to consider.
We’d be very happy to help you with this more! Feel free to book a demo call through our homepage and we can walk you through how the platform works.
Hi!
Could I ask you, if you have data for EBITDA multiple in the fintech sector in the central Europe?
Hi Kateřina, thanks for the question!
Looking at EBITDA multiples on a national basis typically isn’t very useful, as the multiple is determined by growth and risk forecasts which vary significantly according to the industry, even within the same country.
In your case I would suggest using the Financial & Commodity Market Operators & Service Providers multiple, as that will largely reflect those factors as present in the Fintech sector.
Over the past 30 years I have been involved in buying and selling small, privately held companies with revenues under $20MM who are involved in specialized manufacturing or services to the construction/engineering industries. There is much to consider in valuing these companies. But as a first cut, I use a combination of EBITDA and EBITDA as a percent of revenue of the most recent three years. The EBITDA multiple generally vary from 4.5 to 8. It is desirable that the EBIRDA/revenue be at least 8% and the value of enterprise moves upward above 8%. Companies with EBITDA/revenue ratio above 15% are rare.
Interesting response. These are metrics which have a lot of opportunity. Is 4.5-8 valuation based upon the EBITDA to Revenue ratio?
Would you happen to have the multiples of a Fintech (prepaid debit card for kids and teens) based in the MENA region?
Thanks for the question! We store the data per country rather than by region, as the variance across regions can be quite large. I’ll add the data here for Fintech in UAE, but let me know if another country would be a more appropriate example:
Year 1: 1218.40%
Year 2: 126.04%
Year 3: 152.40%
Hope that’s of use!
Hello! thank you for the greatest site and data! Looking forward to order a report from you.
Also wish many health and long life to Dr. Damodaran and his site.
But is it correct to apply these multiples from public traded companies to VC projects without illiquidity discounts?
Hi Ivan, thanks for the wonderful comments and the great question!
The answer depends a bit on the method you choose. It’s our view that the significant discount included in the VC method which already accounts for illiquidity. Both of the DCF methods include an explicit illiquidity discount.
You can read some more about that in our full Methodology PDF, here: https://www.equidam.com/methodology/
This is great content. But i have one question this might generate biased results failing to represent the fair value of a company?
Hi David,
Thanks for your comment on this article!
Multiples reflect the average price of a company when compared to a value driver, in this case EBITDA. They should be used as a benchmark and not to calculate the value of the company, in the same way the average price of a used car should be used as a benchmark, but not to price the specific car. On the assumption that the market is rational and fair and it is correctly assessing valuations, those values should not be biased on average, but these are strong assumptions, and that is why multiples should always be used with care.
I hope this helps clearing up any confusion about the multiples. Of course if you have any further questions, we remain available!
Kind regards,
Giulio
How correctly to calculate the valuation of our 5y/o IT Cloud Hosting company, currently generating 35k$ MRR. 15 team members atm.
Thanks for a great article and those multiplies by the industry.
Hi there,
Thank you for your comment on our article! I hope this message finds you well. The recommended way to value a company is by using various valuation methods to best capture all aspects of your company. By valuing your financial projections and your qualitative information according to internationally practiced valuation methods would be best. You can see more about the valuation methods we apply here at Equidam, click here.
By using the Equidam platform, you can produce a company valuation according to all five of our methods and produce a report that transparently highlights your company value. I hope this helps in understanding valuation and please don’t hesitate to get in touch if you have further questions.
Have a great day,
Giulio
fantastic resource of info – TNX
Thank you, Nadine! Glad you found the info useful!
pls specify size of business as these multiples must be for big businesses?
Hi Marcel,
Thank you for your comment on this article. The companies used for computing the EBITDA multiple are all public companies. You can find an extensive list of the companies here: http://www.stern.nyu.edu/~adamodar/pc/datasets/indname.xls
I hope this information proves helpful in answering your question. If you have any further question, we remain available!
All the best,
Giulio
@Luca
This is great content.
Could you please provide the source of the data? Is there a link to a NYU report or something of sort that could be fact checked?
http://pages.stern.nyu.edu/~adamodar/
This is our data source. We get our data from NYU Stern, Prof. Damodaran. We collect this data yearly and adapt them to our industry classifications.
I hope this information helps!
Kind regards,
Giulio
This EBITDA Multiple by Industry is a useful benchmark
What multiples are you showing in 2024 for American companies purchasing Asian companies who provide software development services?
Hi there, thanks for the question!
In that case I believe you would want to be using the multiple for Software.
Best regards,
Dan