Earnings per Share (Notes)

12 Months Ended

Dec. 31, 2021

Earnings per Share

Under ASC 260, Earnings per Share, the two-class method is an earnings allocation formula that determines earnings per share for each class of common stock according to dividends declared (or accumulated) and participation rights in undistributed earnings. Under that method, basic and diluted earnings per share data are presented for each class of common stock.

In applying the two-class method, we determined that undistributed earnings should be allocated equally on a per share basis between Class A and Class B common stock. Under our Certificate of Incorporation, the holders of the common stock are entitled to participate ratably, on a share-for-share basis as if all shares of common stock were of a single class, in such dividends, as may be declared by the Board of Directors. During the years ended December 31, 2021, 2020 and 2019, we declared and paid quarterly dividends, in the amount of $0.38, $0.32 and $0.27 per share on both classes of common stock.

Basic earnings per share has been computed by dividing net income available to common stockholders by the weighted average number of shares of common stock outstanding during each period. Shares issued during the period and shares reacquired during the period are weighted for the portion of the period in which the shares were outstanding. Diluted earnings per share have been computed in a manner consistent with that of basic earnings per share while giving effect to all potentially dilutive common shares that were outstanding during each period.

The net income available to common stockholders and weighted average number of common shares outstanding used to compute basic and diluted earnings per share for each class of common stock are as follows (in thousands, except per share amounts):


	Year Ended December 31,
	2021		2020		2019
Distributed earnings	$	61,826	$	51,621	$	43,207
Undistributed earnings	75,191		68,909		70,683
Net income	$	137,017	$	120,530	$	113,890

Class A common stock:
Basic net income available to common stockholders	$	92,588	$	81,087	$	76,294
Basic weighted average common shares outstanding	27,459		27,105		26,763
Basic earnings per share	$	3.37	$	2.99	$	2.85

Diluted net income available to common stockholders	$	92,940	$	81,405	$	76,555
Effect of potential exercise of stock options	325		328		279
Diluted weighted average common shares outstanding	27,784		27,433		27,042
Diluted earnings per share	$	3.35	$	2.97	$	2.83

Class B common stock:
Basic net income available to common stockholders	$	44,429	$	39,443	$	37,596
Basic weighted average common shares outstanding	13,177		13,185		13,188
Basic earnings per share	$	3.37	$	2.99	$	2.85

Diluted net income available to common stockholders	$	44,077	$	39,125	$	37,335
Diluted weighted average common shares outstanding	13,177		13,185		13,188
Diluted earnings per share	$	3.35	$	2.97	$	2.83

For the years ended December 31, 2021, 2020 and 2019, options to purchase 53,240 shares, 213,248 shares and 288,133 shares, respectively, were outstanding but not included in the computation of diluted earnings per share because the options' effect would have been anti-dilutive. For the years ended December 31, 2021, 2020 and 2019, there were 196,735 shares, 223,405 shares and 338,748 shares, respectively, issued from the exercise of stock options.