Earnings Per Common Share

3 Months Ended

Mar. 31, 2017

Earnings Per Common Share

Earnings Per Common Share

NOTE 14.  Earnings Per Common Share

The following table illustrates the computation of basic and diluted earnings per share (in thousands, except per share amounts):

	Three Months Ended March 31,
	2017		2016
Numerator
Net income from continuing operations	$	464,177	$	51,337
Noncontrolling interests’ share in earnings		(3,032)		(3,626)
Net income attributable to HCP, Inc.		461,145		47,711
Participating securities’ share in earnings		(770)		(357)
Income from continuing operations applicable to common shares		460,375		47,354
Discontinued operations		—		68,408
Net income applicable to common shares	$	460,375	$	115,762
Numerator - Dilutive
Net income applicable to common shares	$	460,375	$	115,762
Add: distributions on dilutive convertible units		2,803		—
Dilutive net income available to common shares	$	463,178	$	115,762
Denominator
Basic weighted average common shares		468,299		466,074
Dilutive potential common shares - equity awards		229		188
Dilutive potential common shares - DownREIT units		6,645		—
Diluted weighted average common shares		475,173		466,262
Basic earnings per common share
Continuing operations	$	0.98	$	0.10
Discontinued operations		—		0.15
Net income applicable to common shares	$	0.98	$	0.25
Diluted earnings per common share
Continuing operations	$	0.97	$	0.10
Discontinued operations		—		0.15
Net income applicable to common shares	$	0.97	$	0.25

Restricted stock and certain performance restricted stock units are considered participating securities, because dividend payments are not forfeited even if the underlying award does not vest, and require use of the two-class method when computing basic and diluted earnings per share.

Options to purchase 1 million shares of common stock were excluded from the computation of diluted earnings per share for both the three months ended March 31, 2017 and 2016 because they are anti-dilutive. Additionally, 6 million shares, issuable upon conversion of 4 million DownREIT units during the three months ended March 31, 2016, were not included because they are anti-dilutive.