16. Earnings per Share

The Company computes earnings per share using the two-class method, which is an earnings allocation formula that determines earnings per share for common stock and any participating securities according to dividends declared (whether paid or unpaid) and participation rights in undistributed earnings. The Series A Preferred Stock is considered a participating security because it has dividend rights determined on an as-converted basis in the event of Company’s declaration of a dividend or distribution for common shares.

On October 10, 2018, the Company completed its previously announced 1-for-12 reverse stock split. The Successor period presented has been retrospectively revised to reflect this change.

The following table sets forth the computation of basic and diluted net income per common share (amounts in millions, except per share amounts):



	Successor				Predecessor
	Year Ended December 31, 2019		Five Months Ended December 31, 2018		Seven Months Ended July 31, 2018		Year Ended December 31, 2017
Net income attributable to Successor/Predecessor	$	274	$	884	$	154	$	30
Less: Undistributed earnings attributable to participating stockholders	2		8		—		—
Net income attributable to common stockholders	$	272	$	876	$	154	$	30

Net income per common share attributable to Successor/Predecessor common stockholders:
Basic	$	2.99	$	9.65	$	1.57	$	0.31
Diluted	$	2.95	$	9.54	$	1.55	$	0.30

Weighted average shares of common stock outstanding (in thousands):
Basic	91,035		90,813		98,046		97,696
Dilutive effect of stock awards	270		178		1,091		1,107
Dilutive effect of participating securities	839		839		—		—
Diluted	92,144		91,830		99,137		98,803