Stockholders' Equity

6 Months Ended

Jun. 30, 2020

Stockholders' Equity

Stockholders' Equity

10. Stockholders’ Equity

Earnings per Share

The components of basic and diluted earnings per share were as follows:

	Three months ended			Six months ended
	June 30,			June 30,
	2020		2019	2020		2019
	(in thousands, except per share amounts)
Net income attributable to Waddell & Reed Financial, Inc.	$	24,824	33,948	$	46,810	66,002
Weighted average shares outstanding, basic and diluted		65,488	74,694		66,581	75,492
Earnings per share, basic and diluted	$	0.38	0.45	$	0.70	0.87

Dividends

During the quarter, the Board of Directors declared a quarterly dividend on our Class A common stock in the amount of $0.25 per share with an August 3, 2020 payment date and a July 13, 2020 record date. The total dividend to be paid on August 3, 2020 is $16.3 million.

Common Stock Repurchases

The Board of Directors has authorized the repurchase of our Class A common stock in the open market and/or private purchases. The acquired shares may be used for corporate purposes, including issuing shares to employees in our stock-based compensation programs.

There were 1,468,367 shares and 2,142,894 shares repurchased in the open market or privately during the three months ended June 30, 2020 and 2019, respectively, which includes 219,852 shares and 290,910 shares, respectively, repurchased from employees who tendered shares to cover income tax withholdings with respect to vesting of stock awards during these two reporting periods.  There were 5,275,805 shares and 4,369,219 shares repurchased in the open market or privately during the six months ended June 30, 2020 and 2019, respectively, which includes 451,245 shares and 439,983 shares, respectively, repurchased from employees who tendered shares to cover income tax withholdings with respect to vesting of stock awards during these two reporting periods.

Accumulated Other Comprehensive Income

The following tables summarize accumulated other comprehensive income activity for the three and six months ended June 30, 2020 and June 30, 2019.

	For the three months ended June 30,
				Total
	Unrealized		Postretirement	accumulated
	gains (losses) on		benefits	other
	AFS investment		unrealized	comprehensive
	securities		gains (losses)	income (loss)
	(in thousands)
Balance at March 31, 2020	$	91	664	755
Other comprehensive income before reclassification		3,943	—	3,943
Amount reclassified from accumulated other comprehensive income		(160)	(51)	(211)
Net current period other comprehensive income (loss)		3,783	(51)	3,732
Balance at June 30, 2020	$	3,874	613	4,487
Balance at March 31, 2019	$	861	1,034	1,895
Other comprehensive income before reclassification		1,281	—	1,281
Amount reclassified from accumulated other comprehensive income		—	(95)	(95)
Net current period other comprehensive income (loss)		1,281	(95)	1,186
Balance at June 30, 2019	$	2,142	939	3,081

	For the six months ended June 30,
				Total
	Unrealized		Postretirement	accumulated
	gains (losses) on		benefits	other
	AFS investment		unrealized	comprehensive
	securities		gains (losses)	income (loss)
	(in thousands)
Balance at December 31, 2019	$	2,521	713	3,234
Other comprehensive income before reclassification		1,716	—	1,716
Amount reclassified from accumulated other comprehensive income		(363)	(100)	(463)
Net current period other comprehensive income (loss)		1,353	(100)	1,253
Balance at June 30, 2020	$	3,874	613	4,487
Balance at December 31, 2018	$	(797)	1,128	331
Other comprehensive income before reclassification		3,034	—	3,034
Amount reclassified from accumulated other comprehensive income		(95)	(189)	(284)
Net current period other comprehensive income (loss)		2,939	(189)	2,750
Balance at June 30, 2019	$	2,142	939	3,081

Reclassifications from accumulated other comprehensive income (loss) and included in net income are summarized in the tables that follow.

			Tax
For the three months ended June 30, 2020	Pre-tax		expense	Net of tax	Statement of income line item
	(in thousands)
Reclassifications included in net income:
Gains on available for sale debt securities	$	211	(51)	160	Investment and other income
Amortization of postretirement benefits		67	(16)	51	Compensation and benefits
Total	$	278	(67)	211

			Tax
For the three months ended June 30, 2019	Pre-tax		expense	Net of tax	Statement of income line item
	(in thousands)
Reclassifications included in net income:
Amortization of postretirement benefits	$	123	(28)	95	Compensation and benefits
Total	$	123	(28)	95

			Tax
For the six months ended June 30, 2020	Pre-tax		expense	Net of tax	Statement of income line item
	(in thousands)
Reclassifications included in net income:
Gains on available for sale debt securities	$	477	(114)	363	Investment and other income
Amortization of postretirement benefits		134	(34)	100	Compensation and benefits
Total	$	611	(148)	463

			Tax
For the six months ended June 30, 2019	Pre-tax		expense	Net of tax	Statement of income line item
	(in thousands)
Reclassifications included in net income:
Gains on available for sale debt securities	$	125	(30)	95	Investment and other income
Amortization of postretirement benefits		247	(58)	189	Compensation and benefits
Total	$	372	(88)	284