Note 4 - Earnings Per Share

9 Months Ended

Sep. 30, 2019

Notes to Financial Statements

Earnings Per Share [Text Block]

4. Earnings Per Share

ASC 260 requires a company that has participating security holders (for example, holders of unvested restricted stock that have non-forfeitable dividend rights) to utilize the two-class method for calculating earnings per share (“EPS”) unless the treasury stock method results in lower EPS. The two-class method is an allocation of earnings/(loss) between the holders of common stock and a company’s participating security holders. Under the two-class method, earnings/(loss) for the reporting period are allocated between common shareholders and other security holders based on their respective rights to receive distributed earnings (i.e., dividends) and undistributed earnings (i.e., net income/(loss)). Our common shares outstanding are comprised of shareholder owned common stock and shares of unvested restricted stock held by participating security holders. Basic EPS is calculated by dividing income or loss attributable to common stockholders by the weighted average number of shares of common stock outstanding, excluding participating shares in accordance with ASC 260. To calculate diluted EPS, basic EPS is adjusted to include the effect of potentially dilutive stock options outstanding. The table below shows our basic and diluted EPS calculations.

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
	(Dollars in thousands, except per share amounts)
Numerator
Net income	$	50,580		$	53,392		$	145,723		$	156,055
Less: distributed earnings allocated to participating securities		(122	)		(106	)		(343	)		(307	)
Less: undistributed earnings allocated to participating securities		(202	)		(222	)		(554	)		(613	)
Net income attributable to common stockholders (numerator for basic earnings per share)		50,256			53,064			144,826			155,135
Add back: undistributed earnings allocated to participating securities		202			222			554			613
Less: undistributed earnings reallocated to participating securities		(195	)		(218	)		(540	)		(602	)
Numerator for diluted earnings per share under two class method	$	50,263		$	53,068		$	144,840		$	155,146
Denominator
Weighted-average common shares outstanding		61,978,195			60,665,349			61,422,925			60,505,916
Add: dilutive effect of stock options		1,990,020			1,139,443			1,570,194			1,086,176
Add: dilutive effect of performance share units		-			-			367,416			-
Denominator for diluted earnings per share under two class method		63,968,215			61,804,792			63,360,535			61,592,092
Basic Earnings Per Common Share	$	0.81		$	0.87		$	2.36		$	2.56
Diluted Earnings Per Common Share	$	0.79		$	0.86		$	2.29		$	2.52

Diluted EPS for the three and nine months ended September 30, 2019 excluded options to purchase approximately 0.4 and 0.4 million shares of common stock, respectively, because the effect of their inclusion would be anti-dilutive. For the same periods in 2018, diluted EPS excluded options to purchase approximately 0.6 and 0.6 million shares, respectively.