EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2014

Earnings Per Share [Abstract]

EARNINGS PER SHARE

EARNINGS PER SHARE

Basic earnings per share (“EPS”) is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the period.  Diluted EPS reflects the assumed conversion of all dilutive securities using the treasury stock method.

Basic and diluted EPS are calculated as follows:

	Three months ended   September 30,				Nine months ended   September 30,
(in thousands, except per share data)	2014		2013		2014		2013
Net income attributable to Altisource	$	42,287	$	36,008	$	136,019	$	94,457
Weighted average common shares outstanding, basic	21,626		23,025		22,071		23,185
Dilutive effect of stock options	2,014		2,308		2,081		1,885
Weighted average common shares outstanding, diluted	23,640		25,333		24,152		25,070
Earnings per share:
Basic	$	1.96	$	1.56	$	6.16	$	4.07
Diluted	$	1.79	$	1.42	$	5.63	$	3.77

For the third quarter of 2014 and 2013 and the nine months ended September 30, 2014 and 2013, less than 0.1 million options were anti-dilutive in each period and, consequently, have been excluded from the computation of diluted EPS.  These options were anti-dilutive because their exercise price was greater than the average market price of our common stock. Also excluded from the computation of diluted EPS for the nine months ended September 30, 2014 and 2013 are0.1 million options in each period (0.1 million options in each period for the third quarter of 2014 and 2013), granted for shares that are issuable upon the achievement of certain market and performance criteria related to our common stock price and an annualized rate of return to investors that have not yet been met.