3. Earnings Per Share

Basic earnings per share represents income available to common stockholders divided by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflect additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustment to income that would result from the assumed issuance. Potential common shares that may be issued by the Company relate solely to outstanding stock options and restricted stock, and are determined using the treasury stock method.

The following table sets forth the weighted average shares outstanding used in the computations of basic and diluted earnings per share.



(in thousands)	Three Months Ended		Nine Months Ended
	September 30,		September 30,
	2019	2018	2019	2018
Weighted average shares outstanding	6,296	6,264	6,293	6,259
Less: Unvested restricted shares	(35)	(30)	(35)	(30)
Basic EPS weighted average shares outstanding	6,261	6,234	6,258	6,229


Basic EPS weighted average shares outstanding	6,261	6,234	6,258	6,229
Add: Dilutive effect of stock options and restricted shares	48	70	50	72
Diluted EPS weighted average shares outstanding	6,309	6,304	6,308	6,301

For the three and nine month periods ended September 30, 2019, there were 60,650 stock options that were anti-dilutive and thereby excluded from the earnings per share calculations based upon the closing price of Norwood common stock of $31.61 per share as of September 30, 2019.

For the three and nine month periods ended September 30, 2018, there were no stock options that would be anti-dilutive to the earnings per share calculations based upon the closing price of Norwood common stock of $39.16 per share on September 30, 2018.