Earnings Per Share

9 Months Ended

Sep. 30, 2015

The Company calculates its basic and diluted earnings per share in accordance with US GAAP. Basic earnings per share is calculated by dividing net income attributable to the Company's common stockholders by the weighted average number of common shares outstanding for the period. As of September 30, 2015, there were 107,098,068 shares outstanding. The Company has included 497,570 fully vested, unissued restricted stock units in its calculation of basic earnings per share.

Diluted earnings per common share are calculated by adjusting the weighted average outstanding shares to assume conversion of all potentially dilutive items. The Company uses the treasury stock method to reflect the potential dilutive effect of the warrants (see Note 5(a)), unexercised stock options, unvested restricted shares, restricted stock units, and SAR's. In calculating the number of dilutive shares outstanding, the shares of common stock underlying unvested restricted shares and restricted stock units are assumed to have been delivered, and options and warrants are assumed to have been exercised, on the grant date. The assumed proceeds from the assumed vesting, delivery and exercising were calculated as the sum of (a) the amount of compensation cost attributed to future services and not yet recognized and (b) the amount of tax benefit that would be credited to additional paid-in capital assuming vesting and delivery of the shares. The tax benefit is the amount resulting from a tax deduction for compensation in excess of compensation expense recognized for financial statement reporting purposes. All outstanding warrants were not included in the computation of diluted net income (loss) per common share for the three and nine months ended September 30, 2015 and 2014, respectively, as their inclusion would have been anti-dilutive. The Company can elect to settle the Series A Convertible Preferred Stock in shares or cash. The Company's intent is to settle in cash and, based on current and projected liquidity needs, the Company has the ability to do so.

The computation of earnings per share is as follows:



	Three Months Ended September 30,					Nine Months Ended September 30,
	2015			2014		2015		2014
	(dollars in thousands, except per share data)
Net income (loss)	$	(6,002	)	$	10,529	$	24,048	$	38,154
Net income (loss) attributable to redeemable non-controlling interests in consolidated subsidiaries and funds	4,344			4,006		10,980		13,409
Net income (loss) attributable to Cowen Group, Inc.	(10,346		)	6,523		13,068		24,745
Preferred stock dividends	1,603			—		2,358		—
Net income (loss) attributable to Cowen Group, Inc. common stockholders	$	(11,949	)	$	6,523	$	10,710	$	24,745

Shares for basic and diluted calculations:
Weighted average shares used in basic computation	109,191			114,969		111,050		115,407
Stock options	—			—		19		—
Performance based restricted stock	—			—		266		—
Stock appreciation rights	—			59		152		57
Restricted stock	—			3,773		5,762		4,563
Weighted average shares used in diluted computation	109,191			118,801		117,249		120,027
Earnings (loss) per share:
Basic	$	(0.11	)	$	0.06	$	0.10	$	0.21
Diluted	$	(0.11	)	$	0.05	$	0.09	$	0.21