Most owners find out what their practice is worth the day a buyer calls with a number. That is the worst time to learn it, because you have nothing to check the offer against. You can get a solid estimate yourself, long before anyone calls.
The fastest method is a multiple of collections. Take your last twelve months of collections and apply a range. The ADA 2024 Practice Transition Survey put successful sales near 1.1 times gross revenue, with fee-for-service practices closer to 1.3 times and troubled practices as low as 0.6 times. So a $1.2M practice lands somewhere between roughly $720,000 and $1.56M depending on how it is run.
The method buyers actually use is a multiple of earnings, or EBITDA: your profit after adding back owner pay, interest, taxes, and one-time costs. DSOs price off this number, and current multiples run above 2024 levels. How your add-backs are calculated matters as much as the headline multiple.
What moves the number: a clean, fee-for-service-leaning payer mix, low and steady overhead, associate coverage that is not just you, and books a buyer can trust in diligence. Each of those is something you can improve in the years before a sale.
The point of estimating early is not to sell. It is to know whether an offer is strong, weak, or insulting the moment it arrives, and to fix the things that cost you money before a buyer prices them in.