Cummins Inc. Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

EARNINGS PER SHARE

EARNINGS PER SHARE

12 Months Ended

Dec. 31, 2018

NOTE 18. EARNINGS PER SHARE

We calculate basic earnings per share (EPS) of common stock by dividing net income attributable to Cummins Inc. by the weighted-average number of common shares outstanding for the period. The calculation of diluted EPS assumes the issuance of common stock for all potentially dilutive share equivalents outstanding. We exclude shares of common stock held in the Employee Benefits Trust (EBT) (see Note 14, "SHAREHOLDERS' EQUITY") from the calculation of the weighted-average common shares outstanding until those shares are distributed from the EBT to the Retirement Savings Plan. Following are the computations for basic and diluted earnings per share:



	Years ended December 31,
Dollars in millions, except per share amounts	2018		2017		2016
Net income attributable to Cummins Inc.	$	2,141	$	999	$	1,394

Weighted-average common shares outstanding
Basic	162,172,831		166,625,320		169,038,410
Dilutive effect of stock compensation awards	600,516		645,545		298,206
Diluted	162,773,347		167,270,865		169,336,616
Earnings per common share attributable to Cummins Inc.
Basic	$	13.20	$	5.99	$	8.25
Diluted	13.15		5.97		8.23

The weighted-average diluted common shares outstanding excludes the anti-dilutive effect of certain stock options since such options had an exercise price in excess of the monthly average market value of our common stock. The options excluded from diluted earnings per share were as follows:



	Years ended December 31,
	2018	2017	2016
Options excluded	969,385	31,991	1,091,799