Published on 4 Sept 2026 · 2 min read · AuditExpress team
How much is my business worth? The five methods that matter
EBITDA multiple, asset-based, earnings capitalisation, DCF: every method tells a different story. Learn to cross them to set a credible price.
There is no single value for a business, only a range in which a buyer and a seller can meet. Practitioners cross several methods and weight each one according to the quality of the available information. Here are the five we use in every report.
1. The EBITDA multiple
This is the reference for small and mid-sized company transactions. Normalised EBITDA is multiplied by a sector coefficient, usually between 3 and 7, and net debt is then deducted. A retailer generating 195,000 euros of EBITDA with a median multiple of 4.5 is worth about 880,000 euros before the cash adjustment. The multiple rises with recurring revenue, size and low dependence on the owner.
2. The revenue rule of thumb
Used for goodwill transfers, it applies a percentage to annual revenue. It ignores profitability and mainly serves as a floor or a sanity check. Percentages range from 15% for restaurants to more than 100% for some recurring services.
3. The asset-based method
Start from equity, revalue the assets (property, inventory, doubtful receivables) and obtain the adjusted net asset value. This method reflects what the company owns, not what it earns. It dominates for asset-heavy companies and low-profit structures.
4. Earnings capitalisation
Recurring net income is divided by a rate that rewards risk, often between 10 and 15% for an unlisted small company. Net income of 125,000 euros capitalised at 12% gives roughly one million euros. The method is sensitive to the chosen rate, which is why a range is shown.
5. Discounted cash flows
DCF projects free cash flows over five years, discounts them at the cost of capital and adds a terminal value. It is the most rigorous method but also the most dependent on assumptions. We present it with three scenarios to make those assumptions visible.
Cross-check to convince
A credible price sits where at least three methods converge. When the asset value clearly exceeds the earnings methods, the company benefits from selling assets before the sale. When the opposite is true, the recurrence of earnings must be documented to justify the premium. AuditExpress produces this synthesis from your accounts, with a confidence level based on the number of fiscal years available.