25 Mar Industrial Manufacturing Business valuation
Q&A with David & Jay
Question:
What Multiple would you say businesses in the Industrial Manufacturing sector sell for right now?
Answer:
This Sector typically sells for 4-9 times adjusted (normalized) EBITDA. Businesses selling at the higher end of the range typically show strong year over year revenue growth and have more current model manufacturing equipment (fewer labor hours per unit of production). Businesses with military or military related customers also tend to sell for higher multiples. David Humphrey of Beacon Equity Advisors recently commented, “there is a reason these businesses are still located inside the United States after several decades of off shoring. Thus, while all investments have risk, business in this space tend to be less risky which allow for an increase in multiples.
Takeaway:
Your company’s value is driven by efficiency and defensibility. While the general market range is 4x to 9x EBITDA, where you land on that scale depends on how “future-proof” your shop is.
During the 2025 Managing and Accounting Practice (MAP) Conference hosted by the Massachusetts Society of CPAs (MassCPAs), Beacon Equity Advisors’ David Humphrey and Jay Galasso presented an AMA (Ask Me Anything) to the CPA firm partners attending. In this Q&A series, Beacon publishes some of those questions to help business owners make important decisions about the future of their company.