Note 3. Earnings per share

Basic earnings per share is computed by dividing net earnings available to common stockholders by the weighted-average number of shares of common stock outstanding for the period.

Diluted earnings per share reflects the weighted-average number of shares outstanding after consideration of the dilutive effect of stock options and restricted stock.

The following is a reconciliation of net earnings to basic earnings per share and diluted earnings per share:



	Year Ended September 30,
	2017		2016		2015
Numerator:
Net earnings	$	200,507	$	180,838	$	181,452
Denominator:
Basic shares outstanding		61,366		61,893		64,684
Dilutive effect of stock options and restricted stock		2,146		1,663		1,372
Diluted shares outstanding		63,512		63,556		66,056
Income per common share:
Basic earnings per share	$	3.27	$	2.92	$	2.81
Diluted earnings per share	$	3.16	$	2.85	$	2.75

On June 2, 2015, Woodward entered into an accelerated share repurchase agreement (the “ASR Agreement”) with Goldman, Sachs & Co. (“Goldman”) under which Woodward repurchased shares of its common stock for an aggregate purchase price of $125,000. Upon execution of the ASR Agreement, Goldman initially delivered to Woodward 2,048 shares of common stock. Goldman completed the ASR Agreement on September 3, 2015 and delivered 458 additional shares to Woodward. The final number of shares delivered to Woodward was based generally on the average daily volume-weighted average price of Woodward stock during the term of the ASR Agreement of $49.89. The 2,506 shares of common stock delivered by Goldman to Woodward related to the ASR Agreement are reflected in the calculation of basic shares outstanding used in the calculation of earnings per share.

The following stock option grants were outstanding during the fiscal years ended September 30, 2017, 2016 and 2015, but were excluded from the computation of diluted earnings per share because their inclusion would have been anti-dilutive.



	Year Ended September 30,
	2017		2016		2015
Options		68		-		697
Weighted-average option price	$	63.23	$	n/a	$	46.55

The weighted-average shares of common stock outstanding for basic and diluted earnings per share included the weighted-average treasury stock shares held for deferred compensation obligations of the following:



	Year Ended September 30,
	2017		2016		2015
Weighted-average treasury stock shares held for deferred compensation obligations		180		171		190