UNIVERSAL INSURANCE HOLDINGS, INC.UVE

UNIVERSAL INSURANCE HOLDINGS, INC. Earnings Per Share Disclosure

10-KFiled Feb 27, 20262 min read
EARNINGS (LOSS) PER SHARE
Basic earnings (loss) per share (“EPS”) is computed based on the weighted average number of common shares outstanding for the period, excluding any dilutive common share equivalents. Diluted EPS reflects the potential dilution resulting from the impact of common shares issuable upon the exercise of stock options, non-vested performance share units, non-vested restricted stock units, non-vested restricted stock awards, and conversion of preferred stock. In loss periods, the impact of common shares issuable upon the exercises of stock options, non-vested performance share units, non-vested restricted stock units, non-vested restricted stock awards, and conversion of preferred stock are excluded from the calculation of diluted loss per share, as the inclusion of common shares issuable upon the exercise of stock options, non-vested performance share units, non-vested restricted stock units, non-vested restricted stocks awards, and conversion of preferred stock would have an anti-dilutive effect.
The following table reconciles the numerator (i.e., income) and denominator (i.e., shares) of the basic and diluted earnings (loss) per share computations for the periods presented (in thousands, except per share data):
Years Ended December 31,
202520242023
Numerator for EPS:
Net income (loss)$182,951 $58,928 $66,823 
Less: Preferred stock dividends(10)(10)(10)
Income (loss) available to common stockholders$182,941 $58,918 $66,813 
Denominator for EPS:   
Weighted average common shares outstanding27,890 28,498 29,829 
Plus: Assumed conversion of share-based compensation (1)1,041 751 293 
  Assumed conversion of preferred stock25 25 25 
Weighted average diluted common shares outstanding28,956 29,274 30,147 
Basic earnings (loss) per common share$6.56 $2.07 $2.24 
Diluted earnings (loss) per common share$6.32 $2.01 $2.22 
Weighted average number of antidilutive shares85 383 1,680 
(1)Represents the dilutive effect of common shares issuable upon the exercise of stock options, non-vested performance share units, non-vested restricted stock units and non-vested restricted stock awards.

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

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