What does mean comparative financial statements analysis?
Note: I will answer to this question from the Financial Analysis prospective....Accounting issues triggered by different GAAP generally involved in this process will not be part of the answer here... Unless you bring a Case ...
This generally means comparing financial statements from similar entities to determine which one is performing more based on the multiple ratio related to their sector… For instance, if you wanna know which company between Shell and Exxon Mobile is growing fast because you need to invest in one of them, you'll certainly utilize the Compound Annual Growth Rate (CAGR) related to each of them and comparing to the average one on their market during a certain period (FYI CAGR= (Last Revenue/Beginning Revenue)^1/n - 1); n refers to the number of years selected… You may compare other key financial metrics such as Leverage (Debt/EBITDA…); Profitability (ROE; Revenue/EBITDA,…); size or Valuation ones (EV/EBITDA for instance)…You'll come up with some multiples to be used in the comparison (we call this process "comps" in the jargon). You may find some substantial data on www.blumberg.com )…
At the end of the day, just make sure you're comparing the same thing, you cannot compare Aramco financials to BP ones for imstance since they don't use the same GAAP…. You need also to differentiate private companies to public ones …So, other aspects should be considered if one of them needs to acquire the other one.
For instance, based on a report issued by Matt Porzio and his team back in 2016, public companies are more likely to become "acquisition" targets `"if they are small, fast growing, and have low profitability, low leverage, low liquidity and low valuations" (https://www.forbes.com/sites/mattporzio/2016/10/03/6-key-financial-indicators-of-attractive-acquisition-targets/#7d8410e81ab3 )