A complete Aqvire analysis of a representative HVAC acquisition. Every number below was the kind a buyer would otherwise spend days extracting — or never find at all.
Deal under analysis
Houston, TX · 14 employees · Asking $1,150,000
58
AIQ Score
Proceed with caution
Renegotiate price before LOI
$2.42M
Revenue (TTM)
$310K
Claimed SDE
$256K
Adjusted SDE
4.5×
Asking multiple
3.0–3.4×
Industry norm
$820K
Implied fair value
Seller's claimed SDE
Per broker CIM
$310,000
One-time equipment sale in revenue
Non-recurring; misclassified as operating income
− $38,000
Below-market family salary
Office manager (spouse) paid $28K; replacement cost ~$52K
− $24,000
Owner health insurance
Legitimate add-back missed in CIM
+ $8,400
Adjusted SDE
Basis for valuation and DSCR below
$256,400
The $54K gap between claimed and adjusted SDE changes the fair-value estimate by ~$170K at market multiples.
Recommended range: $780K – $880K. The $1.15M asking price sits 31% above the top of the supportable range.
DSCR check: At asking price with an SBA 7(a) at 10% down, debt service is ~$167K/yr — a 1.53 DSCR that drops to 1.29 after the fleet capex reserve. At the recommended range, DSCR improves to 2.1 and the deal finances comfortably.
Customer concentration
Top account — a regional homebuilder — represents 31% of revenue with no written contract. Losing it drops adjusted SDE below lender minimums.
Owner dependence
The owner holds the TACLA master license and personally runs ~70% of estimates. The license does not transfer with the sale; a licensed hire or transition agreement is required.
Price vs. value gap
Asking price implies 4.5× adjusted SDE against an industry norm of 3.0–3.4× for HVAC businesses at this earnings level.
Aging vehicle fleet
11 service vehicles averaging 9.2 years. Estimated $120K in replacements over 36 months — not reflected in seller's earnings presentation.
Facility lease risk
Shop lease expires in 14 months with no renewal option and no assignment clause. Landlord consent is required to close.
Revenue quality
Trailing-year revenue includes a $38K one-time equipment sale presented as operating income, inflating both revenue trend and SDE.
Technician retention
2 of 7 technicians departed in the trailing 12 months amid regional wage pressure. Recruiting pipeline undocumented.
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