Earnings Per Share

9 Months Ended

Sep. 30, 2021

7. Earnings Per Share

Basic earnings per share is computed using the weighted-average number of outstanding shares of common stock during the period. Diluted earnings per share is computed using the weighted-average number of outstanding shares of common stock and, when dilutive, potential shares of common stock outstanding during the period (“Common stock equivalents”). Common stock equivalents consist of incremental shares issuable upon the assumed exercise of stock options and vesting of restricted stock units utilizing the treasury stock method.

The computation of diluted earnings per share is:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(in thousands, except per share data)	2021		2020		2021		2020
	(unaudited)				(unaudited)
Net income	$	647	$	6,314	$	1,648	$	209
Shares used in computation:
Weighted-average common stock outstanding		19,318		19,183		19,262		18,834
Common stock equivalents		494		554		525		608
Weighted-average number of shares		19,812		19,737		19,787		19,442
Diluted earnings per share	$	0.03	$	0.32	$	0.08	$	0.01

Employee stock options with exercise prices greater than the average market price of the common stock were excluded from the diluted calculation as their inclusion would have been anti-dilutive. The following table summarizes the potential shares of common stock excluded from the diluted calculation:

	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(in thousands)	2021		2020		2021		2020
	(unaudited)				(unaudited)
Employee stock options and RSU's		31		31		31		31