EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2022

12. EARNINGS PER SHARE

Basic earnings per share (“EPS”) is computed by dividing net income (loss) by the weighted average number of common shares outstanding for the period, including vested restricted stock awards during the period. Diluted EPS is computed by dividing net income (loss) by the weighted average number of shares outstanding, noted above, adjusted for the dilutive effect of stock options and unvested restricted stock awards. Dilutive securities are common stock equivalents that are freely exercisable into common stock at less than market prices or otherwise dilute earnings if converted. The net effect of common stock equivalents is based on the incremental common stock that would be issued upon the assumed conversion of convertible long-term debt (if not antidilutive, the associated interest expense reflected in net income (loss) available to common shareholders, would be excluded as well), exercise of common stock options and the vesting of RSAs using the treasury stock method. Common stock equivalents are not included in diluted earnings per share when their inclusion is antidilutive.

The following presents the calculation of basic and diluted EPS:


	Three Months Ended
	March 31,
	2022		2021
	(In thousands, except per share data)
Net income (loss) attributable to FedNat Holding Company shareholders	$	(43,914)	$	(19,381)

Weighted average number of common shares outstanding - basic	17,462		14,395

Net income (loss) per common share - basic	$	(2.51)	$	(1.35)


Weighted average number of common shares outstanding - basic	17,462		14,395
Dilutive effect of convertible debt	—		—
Dilutive effect of stock compensation plans	—		—
Weighted average number of common shares outstanding - diluted	17,462		14,395

Net income (loss) per common share - diluted	$	(2.51)	$	(1.35)

Dividends per share	$	—	$	—

For the three months ended March 31, 2022, we excluded (in thousands) dilutive shares of 3,500 from our weighted average number of common shares outstanding - diluted above because their inclusion, as well as retaining the associated interest expense of $0.3 million currently reflected in net income (loss) available to common shareholders for the EPS numerator, would have been antidilutive.