Recurring Revenue Drives HVAC Valuations

HVAC businesses with over 40% recurring revenue from maintenance agreements command platform-tier multiples, as predictable cash flow reduces customer acquisition cost volatility and justifies premium valuations.

“Service-agreement (PMA / RSA / RMR) revenue is the recurring-revenue lever that drives platform-tier multiples. Above 40% recurring revenue triggers platform-tier underwriting because the buyer thesis is recurring-revenue compounding rather than transactional new-install demand.”

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