Net Income Per Share

12 Months Ended

Dec. 31, 2019

Earnings Per Share [Abstract]

Net Income Per Share

10. Net Income Per Share

We utilize the two-class method to compute net income per share. The two-class method allocates a portion of net income to participating securities, which includes unvested awards of share-based payments with non-forfeitable rights to receive dividends. Net income allocated to unvested share-based payments is excluded from net income allocated to common shares. Any undistributed losses resulting from dividends exceeding net income are not allocated to participating securities. Basic net income per share is computed by dividing net income allocated to common shares by the weighted average number of common shares outstanding during the period. Diluted net income per share is computed by dividing net income allocated to common shares by the weighted average number of common shares outstanding during the period, plus the dilutive effect of outstanding stock options.

The following table summarizes the net income allocated to common shares and the basic and diluted shares used in the net income per share computations:

	Year Ended December 31,
(in thousands)	2019			2018			2017
Net income	$	151,099		$	135,413		$	84,402
Less distributed and undistributed earnings allocated to participating securities	(1,759		)	(1,875		)	(1,517		)
Net income allocated to common shares	$	149,340		$	133,538		$	82,885
Weighted average common shares outstanding	40,186			41,217			41,067
Incremental shares from assumed LTIP awards and conversions of common stock options	166			289			204
Adjusted weighted average common shares outstanding	40,352			41,506			41,271
Potentially dilutive securities not included in weighted average share calculation due to anti-dilutive effect	—			—			—