Dental Practice Valuation: Revenue Multiples, EBITDA, and What SBA Lending Data Shows (2026)

"How much is a dental practice worth" gets a different answer depending on who's pricing it. A transition broker will quote you a percentage of annual collections. A DSO development officer will quote a multiple of EBITDA. Both answers are real, both are current, and the gap between them is where most of the negotiating happens. This guide walks through the broker methods, the DSO math, and a third source most buyers never open: the SBA's loan-level lending files, where 13,932 dental practice borrowers show what banks actually lent against these businesses.

The percentage-of-collections rule

The oldest and still most quoted rule prices a practice as a share of its annual collections. DDSmatch, a national transition brokerage, traces the history in its valuation trends article: through the 1980s and 1990s the rule of thumb was 55% to 75% of average collections over the prior three years, and the accepted range today has risen to 65% to 85%, which DDSmatch credits to higher profit margins and productivity in the average practice. Henry Schein Dental Practice Transitions frames the same idea as the annual net receipts method and puts the percentage between 50 and 80 percent of average annual net receipts.

Run the arithmetic and the spread is enormous. A practice collecting $900,000 a year prices at $585,000 at the bottom of the modern band and $765,000 at the top, and the Henry Schein floor would take it to $450,000. Where a practice lands inside the band depends on overhead, payer mix, hygiene production, staff tenure, lease terms and how much of the production walks out the door with the selling doctor. Collections also hide profitability entirely. Two practices collecting the same $900,000 can throw off very different owner income, which is why every serious appraisal moves past collections to earnings.

The earnings methods appraisers actually use

Henry Schein DPT's public guide lists five appraisal methods, with the constants its appraisers apply to dentistry:

• Capitalized earnings. Divide adjusted earnings by a cap rate, typically around 20 to 30 percent for a dental practice.
• Average annual earnings. In non-rural areas, value usually falls between 150 and 200 percent of the average annual earnings available to the owners.
• Discounted cash flows. Project future cash flow and discount it back, with a risk premium that typically ranges from 23 to 31 percent for dentistry.
• Net asset value. Tangible assets plus goodwill, where goodwill generally accounts for roughly 80 to 85 percent of a practice's value.
• Annual net receipts. The collections percentage covered above.

No single method settles the price. Appraisers run several and reconcile, and a buyer reading an appraisal should check which method carried the most weight and why.

What DSOs pay, and why EBITDA needs adjusting

Dental service organizations and their private equity backers price on EBITDA, and their arrival moved the top of the market. DDSmatch gives a worked example: a $1 million practice with $150,000 of EBITDA at a 5.0x multiple is a $750,000 valuation, while a $3 million practice with $600,000 of EBITDA commands 6.0x to 6.5x, or $3.6 million to $3.9 million. Scale gets paid twice, once in the larger EBITDA and again in the larger multiple applied to it.

The number is also easy to inflate. ADS Transitions warns that a seller who skips a market-rate owner salary before calculating EBITDA produces a much larger figure than the practice really earns. ADS imputes an owner salary of 35% of the owner's personal production before computing EBITDA, and notes that a well-managed practice generates adjusted owner net income, salary plus profit, of about 52% of personal production. So when a colleague brags about his multiple at the study club, ask what owner compensation sat in the denominator. ADS's advice is to compare offers in actual dollars, since an unadjusted multiple compares nothing.

What SBA lending data shows

Sale prices for private practices go unreported. Bank lending is public. The SBA publishes loan-level data on every 7(a) and 504 loan in its FOIA files, and Scouly's studies count 13,932 dental practice borrowers inside a 66,310-borrower dataset across seven verticals. Their peak loan sizes:

Every figure is a loan amount. Banks underwrite against verified production and cash flow, so the distribution works as a floor and a sanity check when you're sizing a deal, and it will catch an asking price that's wildly off. Dental's median of $518,250 ranks fourth of the seven verticals Scouly benchmarks. Funeral homes lead at $697,250, then veterinary practices at $632,000 and manufacturing at $558,000. Auto repair sits far below dental at $404,000. Nearly a quarter of dental borrowers took more than $1 million, which fits a vertical where buildouts, equipment, real estate and practice acquisitions all run through SBA financing.

To place a specific number, the deal benchmark tool positions any asking price or loan quote against these quartiles, nationally and by state.

The buyer pool is thinning, which is a pricing fact

The ADA's Health Policy Institute has tracked practice ownership for two decades, and ADA News reported the direction plainly: as of 2021, fewer than 1 in 10 dentists under age 30 owned a practice. In 2005 more than half of dentists aged 30 to 34 were owners; by 2021 it was one-third.

For a solo or two-chair practice below the DSO size threshold, the natural buyer is a young dentist, and there are fewer of them choosing ownership every year. That's negotiating room for the buyer who actually shows up prepared. It also explains why a growing share of owners hear only one offer, from a DSO, and why an individual buyer with financing arranged can be the more welcome conversation.

Valuing a practice you found off-market

Everything above assumes you already have a practice in front of you. Most dental practices never reach a listing site, and the ones that do are the ones brokers chose. Scouly tracks 26,563 U.S. dental practices through public records, each with a verifiable footprint in SBA loan files, PPP records, state registries or mapped establishment data, and none of them listed for sale. The five deepest states:

Coverage thins from there. Massachusetts has 825 tracked practices and Montana just 93.

Every state links from the dental practices for sale hub. The method behind it starts with NAICS 6212 borrowers in the SBA files, then adds registry age and a fragmentation read on the local market. The companion guide to buying a dental practice off-market walks through it.

Public records won't hand you an appraisal. What they confirm before you ever call is that a practice is real, registered, established and carrying bank debt. The maturity date tells you when that debt comes off the books. An owner whose buildout loan retires in 2027 is a likelier transition conversation than one who refinanced last spring. If you want a ranked list of practices in your metro built on those signals, build a thesis for free and Scouly will score every tracked practice against it.

Frequently asked questions

How much is a dental practice worth in 2026?

Most general practices price between 65% and 85% of annual collections, per transition brokers like DDSmatch, or on an EBITDA multiple when a DSO is bidding. A practice collecting $900,000 would price around $585,000 to $765,000 on the collections rule. Larger practices with strong earnings command EBITDA multiples of 5x or more, which can beat the collections math substantially.

What percentage of collections do dental practices sell for?

The modern broker range is 65% to 85% of annual collections, up from the 55% to 75% rule that governed the 1980s and 1990s. Henry Schein DPT's appraisal guide uses 50 to 80 percent of average annual net receipts. The exact percentage depends on profitability, payer mix, staff stability and how transferable the selling doctor's production is.

What EBITDA multiple do DSOs pay for a dental practice?

It scales with size. DDSmatch's published example puts a $1 million practice with $150,000 of EBITDA at 5.0x, and a $3 million practice with $600,000 of EBITDA at 6.0x to 6.5x. Before trusting any multiple, confirm EBITDA was calculated after a market-rate owner salary, since skipping that adjustment inflates the figure badly.

How do you calculate EBITDA for a dental practice?

Start with earnings before interest, taxes, depreciation and amortization, then subtract a fair owner salary for the dentistry the owner personally produces. ADS Transitions imputes owner compensation at 35% of personal production and observes that a well-run practice yields adjusted owner income near 52% of personal production. The remainder after fair compensation is the EBITDA a buyer should price.

Do SBA loan amounts show what a dental practice is worth?

They show what banks lent, which makes them a floor and a sanity check. An appraisal needs earnings, and the public loan files contain none. Across 13,932 dental borrowers in the SBA 7(a) and 504 FOIA files, the median peak loan is $518,250, the 25th to 75th percentile range runs $315,000 to $935,000, and 23% borrowed over $1 million.

Sources

• A Guide to Dental Practice Valuation Methods, Henry Schein Dental Practice Transitions
• Dental Practice Valuation Trends: A Brief History, DDSmatch
• What is EBITDA?, ADS Transitions
• HPI: Dental practice ownership rates are declining, ADA News, January 2023
• SBA 7(a) and 504 FOIA loan-level datasets, data.sba.gov