OP BancorpOPBK

OP Bancorp Earnings Per Share Disclosure

10-KFiled Mar 28, 20252 min read
Earnings Per Share
Basic EPS is calculated using the two-class method. Under the two-class method, all earnings (distributed and undistributed) are allocated to common stock and participating securities. The Company grants restricted stock awards, which entitle recipients to receive nonforfeitable dividends during the vesting period on a basis equivalent to dividends paid to holders of the Company's common stock. These restricted stock awards meet the definition of participating securities based on their respective rights to receive nonforfeitable dividends, and they are treated as a separate class of securities in computing basic EPS. Participating securities are not included as incremental shares in computing diluted EPS.

Diluted EPS incorporates the potential impact of contingently issuable shares. Diluted EPS is calculated under both the two-class and treasury stock methods, and the more dilutive amount is reported. For each of the periods presented in the table below, diluted EPS calculated under two-class method was more dilutive.
The following table presents the calculation of net income applicable to common stockholders and basic and diluted EPS for the years ended December 31, 2024, 2023 and 2022:

Year Ended December 31,
($ in thousands, except share and per share data)202420232022
Basic
Net income$21,069 $23,918 $33,310 
Distributed and undistributed earnings allocated to participating securities(375)(476)(704)
Net income allocated to common shares$20,694 $23,442 $32,606 
Weighted average common shares outstanding14,871,876 15,149,597 15,171,240 
Basic earnings per common share$1.39 $1.55 $2.15 
Diluted
Net income allocated to common shares$20,694 $23,442 $32,606 
Weighted average common shares outstanding for basic earnings per common share
14,871,876 15,149,597 15,171,240 
Add: Dilutive effects of assumed exercises of stock options— 9,260 60,178 
Average shares and dilutive potential common shares14,871,876 15,158,857 15,231,418 
Diluted earnings per common share$1.39 $1.55 $2.14 

No share of common stock was antidilutive for the years ended December 31, 2024, 2023 and 2022.

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.

Other Available Disclosures

Income TaxesFair ValuePP&ELeasesDebtCommitmentsStock CompensationNew Standards