[Superman]

Several methods. Apart from RE value, the only "real" way to value a business, in my humble view, is to discount the expected future net cash flows. Basically, you take the expected profits, extended out a few years, and bring them back to a present value using some sort of interest rate assumption. This, again in my humble view, provides a "real" present value of those earnings. And if the business owner has understated profits.....bummer. That's a double-edged sword and he knew it.