Which financial analysis tool focuses on trends over time?

Trend analysis is the correct choice because it specifically involves examining financial data over a series of periods to identify patterns, movements, and changes over time. This technique is crucial for understanding how a company's financial performance evolves, enabling analysts to forecast future performance based on historical data. By analyzing trends, stakeholders can discern whether a company's financial health is improving, declining, or remaining stable.

In contrast, common sized financial statements present each line item as a percentage of a base figure (like total revenue or total assets) at a single point in time for ease of comparison across companies or periods. While useful for comparing relative sizes, they do not inherently focus on changes over time.

Comparative company analysis involves evaluating metrics across different companies, which may include looking at trend data. However, the primary focus is not exclusively on trends over time but rather on how a company stacks up against its peers.

Financial ratio analysis uses various ratios to assess a company's performance and financial health but does not intrinsically focus on the temporal progression of those ratios unless specifically applied in a trend context. Overall, trend analysis remains the dedicated tool for observing and interpreting financial performance developments over time.