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EBITDA Multiples by Industry: 2026 Private and Public Data
By Tucker Pool, M.S.I.S., Senior Valuation Analyst · Captyx
EBITDA multiples express a company’s enterprise value as a multiple of its annual EBITDA (earnings before interest, taxes, depreciation and amortization). For privately held companies, the most recent survey data puts median multiples at roughly 3.5x to 5.0x for businesses with under $1 million of EBITDA and 4.5x to 7.0x for businesses with $1 million to $5 million, depending on industry. Public companies trade far higher. This reference pulls both data sets into one place, explains why they differ, and shows how to estimate where your own business is likely to land.
All figures below link to their public sources. Use them as a starting point for a conversation, not as a price for any single company. Every business is valued on its own earnings, risks and buyer demand.
How EBITDA Multiples Work
An EBITDA multiple is a ratio: enterprise value ÷ EBITDA. Enterprise value is the value of the whole operating business before you account for how it is financed. Buyers and advisors use the ratio in reverse when pricing a company. They estimate a sustainable, normalized EBITDA figure and multiply it by a range that reflects the company’s size, industry, growth and risk.
For a private company, the EBITDA figure that matters is almost never the number on the tax return. It is adjusted EBITDA: reported earnings with one-time costs, owner perks and non-market expenses added back, and with any below-market costs (for example, an owner who draws no salary) corrected. Our guides on add-backs and normalizing earnings walk through those adjustments in detail.
A worked example
The numbers below are round, illustrative figures, not data from a real transaction.
| Line item | Amount |
|---|---|
| Reported EBITDA | $1,700,000 |
| Add back: one-time legal settlement | $150,000 |
| Add back: owner’s personal vehicle and travel | $50,000 |
| Add back: owner salary above market replacement cost | $100,000 |
| Adjusted EBITDA | $2,000,000 |
| Multiple applied (illustrative) | 5.5x |
| Enterprise value | $11,000,000 |
| Less: interest-bearing debt | ($1,500,000) |
| Plus: excess cash | $500,000 |
| Equity value to the owner (before fees and taxes) | $10,000,000 |
Two lessons sit inside this example. First, every dollar of legitimate add-back is worth a full multiple to the seller. In this example, $300,000 of documented adjustments added $1.65 million of enterprise value. Second, enterprise value is not what you take home. Debt, cash, the working capital adjustment and deal structure all sit between the headline price and your proceeds.
EBITDA multiples vs. SDE multiples
Smaller, owner-operated businesses are often priced on seller’s discretionary earnings (SDE) instead of EBITDA. SDE adds the owner’s full compensation back to earnings, so SDE multiples are lower than EBITDA multiples for the same company. As a business grows to the point where it has a management team and the owner’s salary looks like a market wage, buyers shift to EBITDA. Mixing the two, for example applying an EBITDA multiple to SDE, is one of the most common ways owners overestimate value.
Private-Company EBITDA Multiples by Industry and Size (2026)
The best public window into private-company pricing is the Pepperdine Private Capital Markets Report, published by Pepperdine Graziadio Business School. Its 2026 edition surveys investment bankers about the deals they closed and reports median deal multiples by industry and by the EBITDA size of the company. The table below reproduces those medians (2026 Private Capital Markets Report, Table 31).
| Industry | EBITDA under $1M | $1M–$4.99M | $5M–$9.99M | $10M–$24.99M | $25M+ |
|---|---|---|---|---|---|
| Manufacturing | 5.0x | 5.2x | 6.5x | 7.0x | 7.0x |
| Construction | 3.5x | 5.0x | 6.5x | 8.0x | 7.2x |
| Consumer goods | 4.2x | 4.5x | 5.5x | 8.5x | 8.0x |
| Wholesale | 3.5x | 5.5x | 6.0x | 8.0x | 7.0x |
| Business services | 4.8x | 6.2x | 6.5x | 7.5x | 7.0x |
| Health care | 4.8x | 6.0x | 6.5x | 8.5x | n/a |
| Information technology | 5.0x | 7.0x | 6.0x | 7.0x | 7.5x |
Source: Pepperdine Graziadio Business School, 2026 Private Capital Markets Report, Table 31, “Median Deal Multiples by EBITDA Size of Company.” Medians from a survey of investment bankers. “n/a” means no median was reported for that cell.
What the private data shows
- Size is the biggest single driver. In every industry surveyed, companies with $10 million or more of EBITDA sold at higher medians than companies under $1 million, often by 2 turns or more. Larger companies tend to have deeper management, more diversified customers and access to a wider pool of buyers, including private equity.
- Industry spreads are narrower than most owners expect. Within the $1M–$4.99M band, medians run from 4.5x to 7.0x. Company-specific factors, covered below, often matter as much as the industry label.
- Medians hide wide ranges. Half of the deals in each cell sold for less than the median and half for more. A well-prepared company with recurring revenue can sit well above its cell. A company with a key-customer or key-person problem can sit well below it.
Find your industry
If your company fits one of these categories, our industry pages go deeper on the buyers and value drivers specific to that sector: manufacturing, construction, wholesale and distribution, professional services, healthcare and HVAC. The full list is on our industries we serve page.
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Public-Company EV/EBITDA Multiples by Sector (January 2026)
Public-company multiples are published openly and updated regularly. The most widely cited free data set is maintained by Professor Aswath Damodaran at NYU Stern, who calculates enterprise value multiples by sector for U.S. listed companies. The figures below are for firms with positive EBITDA, using data as of January 2026 (NYU Stern, Enterprise Value Multiples by Sector (US)).
| Sector | Number of firms | EV/EBITDA |
|---|---|---|
| Oil/Gas (Production and Exploration) | 142 | 5.15x |
| Retail (Grocery and Food) | 15 | 8.94x |
| Trucking | 26 | 10.41x |
| Food Wholesalers | 13 | 11.08x |
| Healthcare Support Services | 104 | 11.17x |
| Building Materials | 41 | 11.61x |
| Advertising | 52 | 12.00x |
| Computer Services | 64 | 14.10x |
| Business & Consumer Services | 155 | 14.26x |
| Environmental & Waste Services | 53 | 15.61x |
| Farming/Agriculture | 35 | 16.04x |
| Machinery | 105 | 16.22x |
| Engineering/Construction | 48 | 17.18x |
| Restaurant/Dining | 64 | 17.49x |
| Software (System & Application) | 309 | 24.48x |
| Total market | 5,994 | 19.73x |
Source: Aswath Damodaran, NYU Stern School of Business, “Enterprise Value Multiples by Sector (US),” data as of January 2026, positive-EBITDA firms only.
Why you can’t apply public multiples to a private company
Comparing the two tables, public multiples run roughly two to three times higher than private medians in the same broad industry. That gap is normal and has well-understood causes:
- Liquidity. Public shares can be sold in seconds. A private company takes months to sell and the buyer is locked in, so buyers pay less for the same earnings.
- Scale and diversification. Listed companies are usually far larger, with many product lines, customers and markets. Smaller companies carry more concentration risk.
- Depth of management. Public companies don’t depend on one founder. Many private companies do, and buyers price in the risk of the owner leaving.
- Growth expectations. Public prices reflect investor expectations about long-term growth, which can be high in sectors like software.
Public data is still useful. It shows which sectors investors favor and how sentiment is moving, and sector rankings in the public table often echo the private medians. Just don’t expect a private company with $2 million of EBITDA to sell at the public-market average.
What Moves Your EBITDA Multiple Up or Down
Two companies in the same industry, with the same EBITDA, can sell several turns apart. Buyers adjust the multiple for risk and for how confident they are that earnings will continue after the sale. The factors below come up in nearly every deal. Our guide on what drives small business multiples covers each in more depth.
| Factor | Pushes the multiple up | Pushes the multiple down |
|---|---|---|
| Revenue quality | Recurring contracts, subscriptions, maintenance agreements | One-off projects, lumpy revenue |
| Customer concentration | No customer above roughly 10% of revenue | One or two customers drive most revenue |
| Owner dependence | Management team runs daily operations | Owner holds key relationships and decisions |
| Financial records | Clean, accrual-based, reviewed or audited statements | Cash-basis books, mixed personal expenses |
| Growth trend | Consistent multi-year growth with a clear plan | Flat or declining revenue |
| Margins | At or above industry peers | Below peers without a clear reason |
| Buyer competition | Several qualified buyers bidding | A single buyer negotiating alone |
How to estimate your own multiple
- Normalize your EBITDA. Start with three years of financial statements and document every add-back. A sell-side quality of earnings review can confirm the figure before buyers test it.
- Place yourself in the right size band. Use the adjusted EBITDA figure to find your row in the private-company table above, not the public table.
- Adjust for your risk profile. Score your company honestly against the factors in the table above. Each strength or weakness moves you within, or outside, the median range.
- Test it against the market. The only multiple that counts is the one a qualified buyer will pay. A competitive process, covered in our guide to running a competitive sale, is how sellers find it.
Headline multiple vs. what you actually receive
A quoted multiple describes the total enterprise value of a deal, not the cash you receive at closing. Two offers at the same multiple can be worth very different amounts once you look at how the price is paid. The most common structures are:
- Cash at close. The simplest and most certain form of consideration, usually funded by the buyer’s equity plus senior debt.
- Seller financing. Part of the price is paid over time through a promissory note from the buyer. It can help a buyer reach a higher multiple, but the seller carries repayment risk. See how seller financing works.
- Earnouts. Part of the price depends on the business hitting future targets. Earnouts often bridge a gap between what the seller expects and what the buyer will guarantee. See how earnouts work.
- Rollover equity. The seller reinvests part of the proceeds in the buyer’s new ownership group, common in private equity deals. See rollover equity explained.
When you compare offers, convert each one into the cash you expect to receive and when, and weigh the risk on the deferred portion. A slightly lower multiple with more cash at close can be the better outcome.
How Captyx can help
Captyx is a sell-side M&A advisory and business brokerage firm serving companies from Main Street to the middle market. Captyx’s track record includes more than 225 transactions, more than 1,500 valuations and more than $5 billion in enterprise value, and Captyx is a two-time Inc. 5000 honoree. Captyx also created one of the first online business valuation calculators. To see where your company’s EBITDA multiple is likely to land, start a free valuation.
Frequently Asked Questions
What does a 10x EBITDA multiple mean?
A 10x EBITDA multiple means the business is valued at ten times its annual EBITDA. A company with $3 million of adjusted EBITDA would have an enterprise value of $30 million at 10x. In private markets, 10x is high. The 2026 Pepperdine survey of investment bankers reports medians of 7.0x to 8.5x even for companies with $10 million or more of EBITDA, so 10x usually requires strong growth, recurring revenue or a strategic buyer.
Is 4x EBITDA good?
It depends on the size of the business. For a company with under $1 million of EBITDA, 4x is in line with the 2026 survey medians, which run from 3.5x to 5.0x by industry. For a company with $5 million or more of EBITDA, 4x would be well below the reported medians of 5.5x to 8.5x and could signal elevated risk or a weak sale process.
What is a good EBITDA multiple for valuation?
A good multiple is one at or above the median for your size band and industry, supported by documented earnings. For private companies with $1 million to $5 million of EBITDA, 2026 medians run from 4.5x to 7.0x. Recurring revenue, low customer concentration and a management team that runs the business without the owner all support a multiple above the median.
Why are EBITDA multiples lower for small businesses?
Smaller businesses usually carry more risk per dollar of earnings. They tend to depend on the owner, a few customers or a few employees, and they attract a smaller pool of buyers. Buyers also take on more financing and integration risk relative to the deal size. As companies grow, those risks shrink and more buyers, including private equity groups, compete, which pushes multiples up.
Should I use EBITDA or SDE to value my business?
Use SDE if you are an owner-operator and your compensation is a large share of the profit. Use EBITDA if you have a management team and your salary reflects a market wage. The two produce different multiples, so always pair an SDE figure with an SDE multiple and an EBITDA figure with an EBITDA multiple.
Do buyers apply the multiple to reported or adjusted EBITDA?
Buyers apply the multiple to adjusted EBITDA, but only to adjustments they can verify. Each add-back needs documentation, and buyers often test them in a quality of earnings review. Add-backs that can’t be supported are removed, which lowers the price by the amount removed times the multiple.
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