To enhance ratio analysis, an analyst should compare current performance with:

Comparing current performance with both the current and prior performance of competitors provides a comprehensive view of how a company is faring in its industry. This approach allows analysts to benchmark the company's performance against that of its peers, which is crucial for understanding relative strengths and weaknesses in key financial ratios.

By analyzing the current performance of competitors, an analyst can identify trends and patterns within the industry, gauge how well the company is positioning itself against others, and find areas for improvement. Including prior performance data of competitors also helps to assess whether those firms are improving or declining over time, providing deeper insights into market dynamics.

This comparison goes beyond simply looking at the company’s past performance or relying solely on market trends, which might not account for competitive pressures. For a holistic view, it is essential to examine various aspects of the competitive landscape, hence reinforcing the value of this multicentric analysis in enhancing ratio analysis.