Earnings Per Common Share (EPS)

12 Months Ended

Dec. 31, 2024

Earnings Per Share [Abstract]

Earnings Per Common Share (EPS)

11.EARNINGS PER COMMON SHARE (EPS)

The computation of weighted average shares outstanding and the basic and diluted earnings per common share for the years ended December 31, 2024, 2023 and 2022, consisted of the following (in thousands, except per share amounts):

	2024		2023		2022
Net income	$	120,357	$	94,411	$	74,516
Average common shares outstanding		58,218		57,593		56,806
Basic EPS	$	2.07	$	1.64	$	1.31
Average common shares outstanding		58,218		57,593		56,806
Effect of dilutive stock awards		760		763		865
Effect of dilutive convertible notes		387		—		—
Total potential shares outstanding		59,365		58,356		57,671
Diluted EPS	$	2.03	$	1.62	$	1.29
Equity awards excluded as the impact was anti-dilutive (1)		672		1,143		1,438

(1) Does not reflect the impact of incremental repurchases under the treasury stock method.

Convertible Notes

For our Convertible Notes issued in December 2023, the dilutive effect is calculated using the if-converted method. Upon surrender of the Convertible Notes for conversion, Merit will pay cash up to the aggregate principal amount of the Notes to be converted and pay or deliver, as the case may be, cash, shares of Merit’s common stock or a combination of cash and shares of Merit’s common stock, at Merit’s election, in respect of the remainder, if any, of Merit’s conversion obligation in excess of the aggregate principal amount of the Convertible Notes being converted. Under the if-converted method, we include the number of shares required to satisfy the remaining conversion obligation, assuming all the Convertible Notes were converted. The Convertible Notes only have an impact on diluted earnings per share when the average share price of our common stock exceeds the conversion price of $86.83. The average closing prices of our common stock for the year ended December 31, 2024 were used as the basis for determining the dilutive effect on EPS.