Earnings Per Share

6 Months Ended

May 31, 2016

Basic earnings per share is computed by dividing net earnings attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the Company.

All outstanding nonvested shares that contain non-forfeitable rights to dividends or dividend equivalents that participate in undistributed earnings with common stock are considered participating securities and are included in computing earnings per share pursuant to the two-class method. The two-class method is an earnings allocation formula that determines earnings per share for each class of common stock and participating securities according to dividends or dividend equivalents and participation rights in undistributed earnings. The Company’s restricted common stock (“nonvested shares”) are considered participating securities.

Basic and diluted earnings per share were calculated as follows:



	Three Months Ended			Six Months Ended
	May 31,			May 31,
(In thousands, except per share amounts)	2016		2015	2016	2015
Numerator:
Net earnings attributable to Lennar	$	218,469	183,016	362,549	297,979
Less: distributed earnings allocated to nonvested shares	86		89	175	180
Less: undistributed earnings allocated to nonvested shares	2,119		1,916	3,552	3,105
Numerator for basic earnings per share	216,264		181,011	358,822	294,694
Less: net amount attributable to noncontrolling interests in Rialto's Carried Interest Incentive Plan (1)	396		—	598	—
Plus: interest on 3.25% convertible senior notes due 2021	1,889		1,982	3,872	3,964
Plus: undistributed earnings allocated to convertible shares	2,119		1,916	3,552	3,105
Less: undistributed earnings reallocated to convertible shares	1,987		1,705	3,321	2,774
Numerator for diluted earnings per share	$	217,889	183,204	362,327	298,989
Denominator:
Denominator for basic earnings per share - weighted average common shares outstanding	213,601		202,991	211,947	202,961
Effect of dilutive securities:
Share-based payments	4		9	4	10
Convertible senior notes	16,312		28,041	17,466	27,708
Denominator for diluted earnings per share - weighted average common shares outstanding	229,917		231,041	229,417	230,679
Basic earnings per share	$	1.01	0.89	1.69	1.45
Diluted earnings per share	$	0.95	0.79	1.58	1.30


(1)	The amounts presented above relate to Rialto's Carried Interest Incentive Plan adopted in June 2015 (see Note 8) and represents the difference between the advanced tax distributions received by Rialto's subsidiary and the amount Lennar, as the parent company, is assumed to own.

For both the three and six months ended May 31, 2016 and 2015, there were no options to purchase shares of common stock that were outstanding and anti-dilutive.