Financial analysis is the process of evaluating a company's financial performance, position, and prospects using financial statements, metrics, ratios, and other tools to assess its financial health and make informed decisions. Financial analysis involves interpreting financial data, identifying trends, assessing risks, and evaluating investment opportunities to support decision-making by investors, creditors, managers, and other stakeholders. It encompasses various techniques, including ratio analysis, trend analysis, comparative analysis, and cash flow analysis, to measure profitability, liquidity, solvency, efficiency, and valuation. Financial analysts use financial analysis to benchmark performance, forecast future outcomes, and identify areas for improvement or investment. Understanding financial analysis is essential for assessing the viability, sustainability, and competitiveness of businesses and making sound financial decisions in personal and professional contexts.