Alabama NEMT Company for Sale: $3M Revenue, $376K SDE Breakdown

This episode of Acquisitions Anonymous dives into a non-emergency medical transportation (NEMT) business in Alabama listed for $1–1.4 million with $3 million in revenue and $376,000 in SDE. The hosts, Mills and Heather, express strong skepticism about the deal, primarily due to glaring financial discrepancies—most notably, gross profit exceeding total revenue, which indicates a serious data error. They question the sustainability of the business’s cash flow, especially given a sudden spike in interest expense ($146,000) that suggests significant debt, possibly from an SBA loan. The business relies heavily on federal contracts, which introduces political and payer risk, particularly with Medicaid cuts looming. The hosts highlight the challenges of operating a 24/7 service with fixed, specialized vehicles and fluctuating demand, making asset utilization a major risk. Despite the durable nature of the NEMT industry, they conclude the business is a poor acquisition due to customer concentration, opaque government contracting dynamics, and poor financial transparency. They emphasize the importance of operational diligence, attention to detail, and using behavioral clues (like vehicle cleanliness or vacation habits) to assess seller credibility. The episode ends with a thumbs-down from both hosts, calling it a 'crappy business to be in.'