Note 12 - Earnings Per Share

12 Months Ended

Dec. 31, 2018

Notes to Financial Statements

Earnings Per Share [Text Block]

NOTE

1

2

— EARNINGS PER SHARE

Earnings per share (“EPS”) are based upon the weighted average number of common shares outstanding during each year. The following table shows: (

1

) weighted average basic shares, (

2

) effect of dilutive securities related to stock options and non-vested restricted stock, and (

3

) weighted average diluted shares. Basic EPS are calculated by dividing net income by the weighted average number of common shares outstanding during each period, excluding dilutive stock options and unvested restricted stock awards. Diluted EPS are calculated using the weighted average diluted shares. The total dilutive shares included in annual diluted EPS is a year-to-date weighted average of the total dilutive shares included in each quarterly diluted EPS computation under the treasury stock method. We have

two

forms of outstanding common stock: common stock and unvested restricted stock awards. Holders of restricted stock awards receive non-forfeitable dividends at the same rate as common stockholders and they both share equally in undistributed earnings. Therefore, under the

two

-class method the difference in EPS is

not

significant for these participating securities.

The Company’s calculation of earnings per share (“EPS”) including basic EPS, which does

not

consider the effect of common stock equivalents and diluted EPS, which considers all dilutive common stock equivalents is as follows:

	YEAR ENDED DECEMBER 31, 2018
			Weighted Avg
(dollars in thousands)	Income		Shares		Per-Share
	(Numerator)		(Denominator)		Amount
Basic EPS:
Net income	$	11,537		8,081,482	$	1.43
Effect of dilutive securities:
Stock options		—		1,791
Non-vested restricted stock		—		16,825
Total dilutive shares				18,616
Diluted EPS:
Net income per diluted share	$	11,537		8,100,098	$	1.42

	YEAR ENDED DECEMBER 31, 2017
			Weighted Avg
(dollars in thousands)	Income		Shares		Per-Share
	(Numerator)		(Denominator)		Amount
Basic EPS:
Net income	$	9,094		8,060,686	$	1.13
Effect of dilutive securities:
Stock options		—		3,978
Non-vested restricted stock		—		16,833
Total dilutive shares				20,811
Diluted EPS:
Net income per diluted share	$	9,094		8,081,497	$	1.13

There were

no

anti-dilutive stock options outstanding during

2018

and

2017

because the exercise price of all outstanding options was less than the average market price of the common shares.

During

2018,

weighted average non-vested restricted shares totaling

73,257

were anti-dilutive, and therefore

not

included in the total diluted shares calculation, as the grant date fair value was greater than the average fair market price of the common shares. During

2017,

there were

no

anti-dilutive shares from non-vested restricted stock grants because the fair value of each grant was lower than the average market price of the common shares.