Dental Practice Valuation Calculator

The Dental Practice Valuation Calculator estimates your practice's market value based on annual EBITDA, collections, and real estate assets. This tool helps dentists and practice owners understand their business worth for future planning. Whether you are selling a practice, planning for retirement, or securing financing, this calculator provides a reliable estimate.

Total amount collected from patients and insurance in the last 12 months
Earnings Before Interest, Taxes, Depreciation, and Amortization
Number of patients who have visited in the last 18 months
Number of fully equipped treatment rooms
How many years has this practice been established
Average annual revenue growth over the past 3 years

How Practice Valuation Is Calculated

Practice Valuation represents the current price a buyer might pay for your dental business. We use the Adjusted EBITDA Multiple Method, which focuses on profitability rather than just revenue to give a clearer picture of true business value.

(Annual EBITDA × Adjusted Multiple) + Equipment Value + Real Estate Value

Where:

  • Annual EBITDA = Earnings Before Interest, Taxes, Depreciation, and Amortization
  • Adjusted Multiple = A factor based on practice type, location, and growth
  • Equipment/Real Estate Value = Estimated worth of physical assets

First, we determine your Adjusted EBITDA, which is your net income adjusted for non-cash expenses. This number is multiplied by a specific multiple based on your practice type, location, and growth rate. Finally, we add the value of tangible assets like equipment and real estate ownership. This method ensures the calculation reflects both cash flow and asset worth.

  1. Determine your Adjusted EBITDA to find true profitability.
  2. Apply the industry multiple based on your market.
  3. Add the value of equipment and real estate.

What Your Practice Valuation Means

This number represents the estimated fair market value of your life's work. It serves as a critical starting point for making serious financial decisions regarding your business future.

Selling Your Practice: A valuation between $1 million and $3 million suggests a healthy, profitable business ready for the market. If your result falls below $1 million, consider boosting patient retention or collections before listing to maximize your return.

Partnership Buy-ins: Knowing your value helps set fair buy-in prices for new associates. For example, a practice valued at $2 million typically requires a 40% buy-in of $800,000 plus shared debt responsibilities.

Retirement Planning: If your retirement goal requires $3 million and the calculator shows $2.5 million, you have a strong asset. However, you might need to delay retirement or increase personal savings slightly to bridge the gap.

Important Note: This tool provides a general estimate only. Actual market value fluctuates based on local buyer demand, economic conditions, and specific practice strengths.

This tool is for educational purposes only and does not constitute professional financial or legal advice. You should consult a certified practice appraiser or financial advisor for official valuations and transaction details.

To prepare for a sale, review your financial statements with a broker annually to ensure your records support the highest possible valuation.

Related Calculators

Calculation logic verified using publicly available standards.

View our Accuracy & Reliability Framework →