For us at Herencia, we focus on just 3 things - 1. Business quality/ stability (business model, size, age of business, mission-criticality of services provided and competition) 2. Revenue predictability (Recurring or re-occurring rev % vs project-based revs) 3. Profit margins and cash generation (How much revenue does the company keep and how quickly does it get paid)

You can only estimate ROI on free cash flow. EBITDA less anticipated cap ex. SDE is bogus because you will take a salary, a fair market salary. All the other things are important (as are the above comments) for analyzing a deal, very important. For customers it's more than concentration, it's also stickiness, GM per customer, etc. Plus, management team, key employees, suppliers and their diversity, technology, marketing program, and more.