Lehigh County HVAC Company, 20-Year Pennsylvania Contractor

$1.5M

Revenue

$505K

SDE

3.6x

Multiple

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Full Editorial Writeup

This is a residential-focused HVAC contractor operating out of Lehigh County, PA, founded in 2006 and serving a roughly 50-mile radius that spans Lehigh, Northampton, Bucks, and Berks counties. The revenue mix is 90% residential and 10% commercial, split evenly between service and installation work, with minimal exposure to new construction. The company runs lean with 8 W-2 employees plus a part-timer, a fleet of 8 vehicles, and operates on Housecall Pro for dispatch and job management.

The business generated $1.48M in gross sales in 2025 with $505K in cash flow, up meaningfully from $1.40M revenue and $208K adjusted net income in 2024. Demand is strong enough that jobs are booked roughly four weeks out, and customer acquisition is almost entirely word of mouth and repeat clientele, with no paid marketing engine driving growth. That is both the appeal and the opportunity here: the phone rings on reputation alone.

The owner is retiring and works mostly back office rather than on the tools, which makes the transition cleaner for a buyer who can slot in an operator or promote a lead tech. The deal is fully SBA-approved. Real estate (a 7,200 sqft property valued around $700K) is not in the asking price but can be bought separately or leased back from the seller at $2,800 a month.

Why we like it

Earnings quality took a real step up in 2025, with adjusted net income jumping to $505K from $208K in 2024 and $197K in 2023. That is a genuine inflection, though a buyer must underwrite whether the jump is durable or a one-time spike before paying a 3.56x multiple on the peak year.
HVAC is about as recession-resistant as home services gets, because heating and cooling failures are non-discretionary and get fixed regardless of the economy. With a 50/50 service and install mix, the service half provides a steady floor of must-do repair work even when install demand softens.
The business is booked roughly four weeks out purely on word of mouth and repeat customers, meaning demand exceeds current capacity with zero marketing spend. That is a rare position of strength and a clear lever a new owner can pull without reinventing the business.
The owner already works mostly back office rather than in the field, so the operational knowledge sits with the 8-person crew rather than walking out the door. A buyer inherits a functioning team and Housecall Pro systems, which lowers key-person risk relative to a tool-swinging owner-operator deal.

How to improve it

Launch a service agreement or maintenance membership program immediately, because the business explicitly has no contracts in place today. Converting even a fraction of the repeat customer base into recurring annual tune-up plans would smooth revenue, lock in customers, and materially raise the exit multiple.
Build a basic demand-generation engine beyond word of mouth: Google Local Service Ads, a review-generation flow, and simple paid search. Customer acquisition is currently 100% organic, so layering in paid channels could fill the pipeline beyond the current four-week backlog.
The four-week job backlog signals a capacity constraint, not a demand problem. Hire and train additional techs to shorten lead times and capture jobs currently lost to competitors who can show up sooner, directly converting existing demand into incremental revenue.
Push the commercial mix above its current 10%, since commercial maintenance and install work tends to carry stickier relationships and larger ticket sizes. Target property managers and small facilities in the existing four-county service area to diversify away from pure residential.
Scrutinize and tighten the COGS and labor lines, which ran $451K and $259K respectively in 2025. Small improvements in job costing, parts procurement, and tech utilization drop straight to the bottom line on a business this size.
Formalize pricing and upsell at the point of service, especially around full system replacements versus repairs. With 50% repeat customers and aging installed base, a structured replacement-recommendation process on service calls is a reliable path to higher install revenue.

Diligence notes

The single biggest question is the durability of the 2025 earnings jump. Net income was flat around $200K in 2023 and 2024, then more than doubled to $505K in 2025, so verify the drivers (price increases, volume, one-time jobs, or expense cuts) line by line before accepting the peak year as normalized.
Confirm the real estate structure and its cost impact. The asking price excludes the $700K building, so model the deal both ways: a $2,800/month lease adds about $34K in annual occupancy cost, while buying adds $700K to the total capital outlay and changes the SBA financing math.
Stress-test the word-of-mouth model and customer concentration. With no contracts, 50% new customers, and acquisition entirely organic, understand how resilient the pipeline is if the retiring owner's personal relationships and local reputation leave with him.
Validate the team and the key-person risk below the owner. Get the 8-employee breakdown post-NDA, identify who holds the technical licenses and the lead relationships, and assess retention risk and whether the required contractor license is truly as easy to obtain as stated.
Reconcile the interest expense swings and add-backs across years. Interest ran $32K in 2023, dropped to $5K in 2024, then rose to $35K in 2025, which affects the cash flow bridge; confirm the SDE calculation and what is genuinely add-backable versus ongoing.

Source

Originally listed on BizBuySell. View original listing →