Roofing contractor acquisitions sit in a 1.8×–3.5× SDE band. Top-of-band placement requires replacement and maintenance revenue dominance — storm-chasing revenue receives a structural discount.

Storm normalization is now a categorical SBA requirement, not a negotiable adjustment. A roofing business with $520K SDE in a hail-active trailing year and $210K SDE in a clean trailing year cannot be underwritten on the $520K figure. Lenders are requiring 3-year SDE trends and will discount storm-year outliers to a 5-year weighted average in markets with documented storm event history. If the trailing period is storm-heavy, surface that proactively — lenders will find it in underwriting regardless.

Workmanship warranty tail liability is the most commonly unpriced risk in roofing deals. A contractor who installed $12M of residential roofing over the past 4 years under a 10-year workmanship warranty has a forward contingent liability of $180K–$360K at standard claim rates. This is not theoretical — it is a quantifiable reserve. Require an escrow or price adjustment for warranty tail at close, or document it explicitly as a known assumed liability.