15. Earnings Per Share

We use the two-class method of calculating earnings per share (which we refer to as “EPS”) as our non-vested restricted stock awards have non-forfeitable rights to dividends and, accordingly, represent a participating security. The two-class method is an earnings allocation method under which EPS is calculated for each class of common stock and participating security considering both dividends declared (or accumulated) and participation rights in undistributed earnings as if all such earnings had been distributed during the period. We use the treasury stock method to calculate the dilutive effect of our restricted stock units as the restricted stock units do not have participating rights.

The following table sets forth the computation of basic and diluted EPS for the three and nine months ended September 30, 2017 and 2016 (in thousands, except share and per share information):


	Three Months Ended				Nine Months Ended
	September 30,				September 30,
	2017		2016		2017		2016
Numerator
Net income	$	9,470	$	13,342	$	33,100	$	34,467
Less: Undistributed earnings allocated to participating securities		(52)		(241)		(289)		(785)
Net income allocable to common stockholders	$	9,418	$	13,101	$	32,811	$	33,682
Denominator
Weighted average common shares outstanding - basic		25,445,552		20,673,521		23,038,390		20,643,682
Dilutive effect of restricted stock units		280,585		148,545		236,930		88,248
Weighted average common shares outstanding - diluted		25,726,137		20,822,066		23,275,320		20,731,930
Earnings per share:
Basic	$	0.37	$	0.63	$	1.42	$	1.63
Diluted	$	0.37	$	0.63	$	1.41	$	1.62

We did not have any common unit equivalents to exclude from diluted earnings per share during the three and nine months ended September 30, 2017.