Earnings Per Share

3 Months Ended

Feb. 28, 2021

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") is considered participating securities.

Basic and diluted earnings per share were calculated as follows:


	Three Months Ended
(In thousands, except per share amounts)	February 28, 2021		February 29, 2020

Numerator:
Net earnings attributable to Lennar	$	1,001,369	398,452
Less: distributed earnings allocated to nonvested shares	630		334
Less: undistributed earnings allocated to nonvested shares	11,624		4,092
Numerator for basic earnings per share	989,115		394,026
Less: net amount attributable to Rialto's Carried Interest Incentive Plan (1)	553		—



Numerator for diluted earnings per share	$	988,562	394,026
Denominator:
Denominator for basic earnings per share - weighted average common shares outstanding	309,020		311,213
Effect of dilutive securities:
Shared based payments	—		2

Denominator for diluted earnings per share - weighted average common shares outstanding	309,020		311,215
Basic earnings per share	$	3.20	1.27
Diluted earnings per share	$	3.20	1.27

(1)The amounts presented relate to Rialto's Carried Interest Incentive Plan and represent the difference between the advanced tax distributions received from the Rialto funds included in the Lennar Other segment and the amount Lennar is assumed to own.

For both the three months ended February 28, 2021 and February 29, 2020, there were no options to purchase shares of common stock that were outstanding and anti-dilutive.