15. Earnings Per Share

We use the two-class method of calculating EPS as our non-vested RSAs 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 RSUs and PSUs as these awards 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, 2018 and 2017 (in thousands, except share and per share information):


	Three Months Ended				Nine months ended
	September 30,				September 30,
	2018		2017		2018		2017
Numerator
Net income	$	17,048	$	9,470	$	70,261	$	33,100
Less: Undistributed earnings allocated to participating securities		—		(52)		(58)		(289)
Net income allocable to common stockholders	$	17,048	$	9,418	$	70,203	$	32,811
Denominator
Weighted average common shares outstanding - basic		30,232,376		25,445,552		29,885,858		23,038,390
Dilutive effect of restricted stock units		322,505		280,585		303,200		236,930
Weighted average common shares outstanding - diluted		30,554,881		25,726,137		30,189,058		23,275,320
Earnings per share:
Basic	$	0.56	$	0.37	$	2.35	$	1.42
Diluted	$	0.56	$	0.37	$	2.33	$	1.41

Stock-based awards are excluded from the calculation of diluted EPS in the event they are subject to unsatisfied performance conditions or are antidilutive. We excluded 0.3 million common unit equivalents from diluted earnings per share during the three and nine months ended September 30, 2018 related to the PSU’s granted during the periods. 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.