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Basic and Diluted Earnings per Share
 3 Months Ended
Mar. 31, 2015
Earnings Per Share [Abstract]  
Basic and Diluted Earnings per Share
Note 15 – Basic and Diluted Earnings per Share
Basic earnings per share excludes common stock equivalents and is calculated by dividing net income attributable to Ocwen common stockholders by the weighted average number of common shares outstanding during the year. We calculate diluted earnings per share by dividing net income attributable to Ocwen, as adjusted to add back any preferred stock dividends, by the weighted average number of common shares outstanding including the potential dilutive common shares related to outstanding stock options, restricted stock awards and preferred stock. The following is a reconciliation of the calculation of basic earnings per share to diluted earnings per share for the three months ended March 31:
 
2015
 
2014
Basic earnings per share:
 
 
 
Net income attributable to Ocwen common stockholders
$
34,355

 
$
59,504

 
 
 
 
Weighted average shares of common stock
125,272,228

 
135,227,067

 
 
 
 
Basic earnings per share
$
0.27

 
$
0.44

 
 
 
 
Diluted earnings per share:
 
 
 
Net income attributable to Ocwen common stockholders
$
34,355

 
$
59,504

Preferred stock dividends (1)
—

 
997

Adjusted net income attributable to Ocwen
$
34,355

 
$
60,501

 
 
 
 
Weighted average shares of common stock
125,272,228

 
135,227,067

Effect of dilutive elements:
 
 
 
Preferred stock (1)
—

 
1,950,298

Stock options
1,725,280

 
3,908,333

Common stock awards
2,154

 
3,757

Dilutive weighted average shares of common stock
126,999,662

 
141,089,455

 
 
 
 
Diluted earnings per share
$
0.27

 
$
0.43

 
 
 
 
Stock options and common stock awards excluded from the computation of diluted earnings per share:
 
 
 
Anti-dilutive (2)
2,010,902

 
—

Market-based (3)
851,263

 
547,500

 
(1)
Prior to the conversion of our remaining preferred stock into common stock in July 2014, we computed the effect on diluted earnings per share using the if-converted method. For purposes of computing diluted earnings per share, we assume the conversion of the preferred stock into shares of common stock unless the effect is anti-dilutive.
(2)
These options were anti-dilutive because their exercise price was greater than the average market price of our stock.
(3)
Shares that are issuable upon the achievement of certain performance criteria related to Ocwen’s stock price and an annualized rate of return to investors.