Earnings Per Share

12 Months Ended

Dec. 31, 2018

Note 11. Earnings Per Share

Basic earnings per share is calculated by dividing Net income by the weighted-average number of shares of common stock outstanding. Diluted earnings per share is similarly calculated, except that the calculation includes the dilutive effect of the assumed issuance of shares under stock-based compensation plans, unless the inclusion of such shares would have an anti-dilutive impact. The computations of the Company’s basic and diluted earnings per share are set forth below (in thousands, except per share amounts):

	Year Ended December 31,
	2018		2017 ⁽¹⁾		2016 ⁽¹⁾
Net income	$	38,809	$	224,443	$	176,370
Basic weighted-average common shares outstanding		70,318		71,661		71,588
Effect of dilutive stock-based compensation awards		229		66		—
Diluted weighted-average common shares outstanding		70,547		71,727		71,588
Earnings per share, basic	$	0.55	$	3.13	$	2.46
Earnings per share, diluted		0.55		3.13		2.46

(1)

As of the date of the Separation on May 31, 2017, the total shares outstanding are 71.6 million. For the year ended December 31, 2016, the 71.6 million shares are utilized for the calculation of both basic and diluted earnings per share, as no shared-based awards were outstanding prior to the Separation date. In addition, for the year ended December 31, 2017, the calculation of both basic and diluted earnings per share includes the 71.6 million shares as the shares outstanding during the period of January 1, 2017 through May 31, 2017.

As of December 31, 2018, the Company has two classes of stock which consist of common stock and preferred stock. As of December 31, 2018, the Company has only issued common stock at a par value of $0.01.