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financial analysis is the process of assessing a company's performance and making recommendations about how it's going to perform in the future financial analysts carry out their work in Excel and use historical data to then generate projections about the future let's look at the most common types of financial analysis and the ones that we're going to discuss in this tutorial these twelve types are extremely important and we're going to outline what each of them are and how they're useful let's begin with a vertical analysis in vertical analysis an analyst will take each line item on the income statement and divide it into revenue to see it as a percentage this enables the analyst to compare the company to other companies in the same industry which is why is also called a common sized income statement so this is a very good first step in comparing companies another type of analysis is horizontal with horizontal instead of moving u

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