Net Income Per Share

Basic net income per share is computed using the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed by adjusting the weighted-average number of common shares outstanding for the effect of dilutive potential common shares outstanding during the period. Potential common shares included in the diluted calculation consist of incremental shares issuable upon the exercise of outstanding stock options calculated using the treasury stock method.

The following table sets forth the calculation of basic and diluted net income per share (in thousands, except per share amounts):



	Year Ended December 31,
	2018		2017		2016
Numerator:
Income from continuing operations	$	4,661	$	1,592	$	6,007
Income from discontinued operations, net of income taxes	—		1,938		624
Net income	$	4,661	$	3,530	$	6,631
Denominator:
Weighted average common shares—basic	12,323		12,882		13,997
Effect of dilutive securities: stock options	187		12		—
Weighted average common shares—diluted	12,510		12,894		13,997
Income per share—basic:
Continuing operations	$	0.38	$	0.12	$	0.43
Discontinued operations	—		0.15		0.04
Net income per share—basic	$	0.38	$	0.27	$	0.47
Income per share—diluted:
Continuing operations	$	0.37	$	0.12	$	0.43
Discontinued operations	—		0.15		0.04
Net income per share—diluted	$	0.37	$	0.27	$	0.47

For the years ended December 31, 2018, 2017 and 2016, options to purchase 200,000, 550,000 and 600,000 shares of common stock, respectively, were not included in the computation of diluted net income per share because the effect would have been anti-dilutive.