What's My HVAC Business Worth in 2026?

If you own an HVAC company, you've probably noticed more interest from buyers lately. Private equity has discovered the trades, and HVAC is one of their favorite targets.

But what's your company actually worth? Let's break it down.

The Basic Numbers

Most HVAC companies sell for 2.5x to 3.5x SDE (Seller's Discretionary Earnings) when selling to individual buyers.

Companies with more scale that attract private equity or strategic buyers can see 4x to 6x+ EBITDA.

The median sale price for HVAC businesses is around $725,000, but this varies enormously based on size.

What Drives Higher Multiples

Recurring revenue is king. Maintenance agreements and service contracts create predictable cash flow. An HVAC company with 40% of revenue from recurring sources is worth significantly more than one doing 100% break-fix work.

If you don't have a maintenance program, start one now. Even 12-18 months of building this base before a sale makes a difference.

Technician depth matters. If you're still the best tech on your team, that's a problem. Buyers want companies where skilled technicians can run calls without the owner.

Commercial mix helps. Commercial HVAC work often has better margins and longer customer relationships than residential. A healthy mix of both is attractive.

Geographic density. Route density affects profitability. A company with customers clustered in a tight service area is more efficient than one spread across a wide territory.

What Hurts Your Value

Owner in the truck. If you're running service calls, selling jobs, and managing the office, the business depends entirely on you. Buyers discount heavily for this.

No management layer. You need someone who can run operations when you're not there. Even a strong service manager or office manager helps.

Old equipment. The condition and age of your fleet, tools, and inventory affects value. Deferred maintenance on your own assets is a red flag.

Concentration risk. If your top 5 customers are 40% of revenue, what happens if one leaves? Diversification reduces risk and increases value.

PE vs. Individual Buyers

The buyer type dramatically affects your multiple:

Individual buyers (owner-operators, first-time buyers):

• Typically pay 2-3.5x SDE
• Usually use SBA financing
• Want a business they can run day-to-day
• Price ceiling around $2-3M total

Private equity (building platforms):

• Pay 4-6x+ EBITDA for platforms
• Looking for $1M+ EBITDA typically
• Want management in place
• Often ask sellers to roll equity

If you're at $500K EBITDA, you're likely selling to an individual. At $1.5M EBITDA, PE becomes interested. The multiple difference can be substantial.

Example Valuations

Company A: Owner-operated, $150K SDE, no maintenance contracts, 2 trucks

• Likely value: $375K - $450K (2.5-3x SDE)
• Buyer: Individual looking for a job/business

Company B: $400K SDE, 25% recurring revenue, service manager in place, 5 trucks

• Likely value: $1.2M - $1.6M (3-4x SDE)
• Buyer: Experienced operator or small PE add-on

Company C: $2M EBITDA, 40% recurring, full management team, 20+ trucks

• Likely value: $10M - $14M (5-7x EBITDA)
• Buyer: Private equity platform or large strategic

What PE Looks For

If you want to attract private equity buyers (and their higher multiples), here's their checklist:

• Scale: $1M+ EBITDA minimum, $2M+ preferred
• Recurring revenue: 25%+ from maintenance contracts
• Management: Business runs without owner involvement
• Growth: Consistent revenue growth trajectory
• Clean financials: Professional books, auditable records
• Density: Strong market position in your service area

You don't need all of these, but each one you're missing reduces your multiple.

What To Do Now

If you're thinking about selling in the next few years:

Build recurring revenue. Start or expand your maintenance agreement program. Target 30%+ of revenue from recurring sources.

Develop your team. Promote a service manager. Cross-train technicians. Reduce your involvement in daily operations.

Clean up financials. Work with a bookkeeper to get professional financials. Track revenue by service type, technician productivity, customer acquisition.

Document everything. SOPs, training materials, pricing guides. Make the business teachable.

Maintain your assets. Update aging equipment. Keep vehicles well-maintained. Don't defer spending that will hurt value.

Even if you're not ready to sell, these improvements make your business more profitable and easier to run.

Timeline Reality

Most HVAC owners think they can decide to sell and close in a few months. Reality is different:

• Building recurring revenue: 12-24 months
• Developing management: 12-18 months
• Cleaning up financials: 6-12 months
• Actual sale process: 6-12 months

Start preparing 2-3 years before you want to exit if you want the best outcome.

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Want to see what HVAC businesses typically sell for? Check the valuation guide or schedule a conversation to talk about your specific company.