Horizontal Analysis

Horizontal Analysis, also known as trend analysis, is a financial analysis technique that compares historical financial data over multiple periods. This method involves calculating the percentage change in financial statement items, such as revenue, expenses, or profits, from one period to the next. By highlighting trends and growth patterns, horizontal analysis helps identify significant changes and trends in a company’s financial performance over time. It is useful for evaluating the consistency and trajectory of financial performance, facilitating better strategic planning and decision-making.