Hanover Bancorp, Inc. /MD Earnings Per Share Disclosure
Note 18. Earnings Per Share
The two-class method is used in the calculation of basic and diluted earnings per share (“EPS”). Under the two-class method, earnings available to common shareholders for the period are allocated between common shareholders and participating securities according to dividends declared and participation rights in undistributed earnings. The restricted stock awards granted by the Company contain non-forfeitable rights to dividends and therefore are considered participating securities.
The Company’s basic and diluted EPS calculations are presented in the following table:
Year Ended December 31, | ||||||
(in thousands, except share and per share data) | | 2025 | 2024 | |||
Net income available to common stockholders | $ | 7,488 | $ | 12,346 | ||
Less: Dividends paid and earnings allocated to participating securities | (194) | (384) | ||||
Income attributable to common stock | $ | 7,294 | $ | 11,962 | ||
Weighted average common shares outstanding, including participating securities | 7,471,442 | 7,403,758 | ||||
Less: Weighted average participating securities | (214,578) | (245,599) | ||||
Weighted average common shares outstanding |
| 7,256,864 | 7,158,159 | |||
Basic EPS | $ | 1.01 | $ | 1.67 | ||
Income attributable to common stock | $ | 7,294 | $ | 11,962 | ||
Weighted average common shares outstanding |
| 7,256,864 | 7,158,159 | |||
Weighted average common equivalent shares outstanding | 5,916 | 28,983 | ||||
Weighted average common and equivalent shares outstanding | 7,262,780 | 7,187,142 | ||||
Diluted EPS | $ | 1.00 | $ | 1.66 | ||
There were no stock options that were antidilutive at December 31, 2025 and 2024.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 13, 2026 | Showing above |
| 2024 | Mar 14, 2025 | |
| 2023 | Dec 21, 2023 | |
| 2022 | Dec 23, 2022 | |
| 2021 | Dec 23, 2021 | |
About Earnings Per Share Disclosures
The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.
Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.