EARNINGS PER SHARE

The following table reconciles net earnings attributable to common shareowners and the weighted-average shares outstanding used to calculate basic and diluted earnings per share for the three and six months ended June 30, 2018 and July 1, 2017:



	Second Quarter				Year-to-Date
	2018		2017		2018		2017
Numerator (in millions):
Net earnings attributable to common shareowners¹	$	293.6	$	277.6	$	464.2	$	671.3

Denominator (in thousands):
Basic weighted-average shares	149,748		149,514		150,101		149,353
Dilutive effect of stock contracts and awards	2,746		2,712		3,023		2,509
Diluted weighted-average shares	152,494		152,226		153,124		151,862
Earnings per share of common stock¹:
Basic	$	1.96	$	1.86	$	3.09	$	4.49
Diluted	$	1.93	$	1.82	$	3.03	$	4.42

¹Prior year amounts have been recast as a result of the adoption of the new revenue standard. Refer to Note B, New Accounting Standards, for further discussion.

The following weighted-average stock options were not included in the computation of diluted shares outstanding because the effect would be anti-dilutive (in thousands):



	Second Quarter		Year-to-Date
	2018	2017	2018	2017
Number of stock options	1,161	—	1,162	1,163

As described in detail in Note J, Equity Arrangements, the Company issued $750 million Equity Units in May 2017 comprised of $750.0 million of convertible preferred stock and forward stock purchase contracts. On and after May 15, 2020, the convertible preferred stock may be converted into common stock at the option of the holder. At the election of the Company, upon conversion, the Company may deliver cash, common stock, or a combination thereof. The conversion rate was initially 6.1627 shares of common stock per one share of convertible preferred stock, which is equivalent to an initial conversion price of approximately $162.27 per share of common stock. As of June 30, 2018, due to the customary anti-dilution provisions, the conversion rate was 6.1709, equivalent to a conversion price of approximately $162.05 per share of common stock. The convertible preferred stock is excluded from the denominator of the diluted earnings per share calculation on the basis that the convertible preferred stock will be settled in cash except to the extent that the conversion value of the convertible preferred stock exceeds its liquidation preference. Therefore, before any redemption or conversion, the common shares that would be required to settle the applicable conversion value in excess of the liquidation preference, if the Company elects to settle such excess in common shares, are included in the denominator of diluted earnings per share in periods in which they are dilutive. The shares related to the convertible preferred stock have been anti-dilutive during most of 2018.