Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Weighted-Average Fair Value Assumptions

The weighted-average fair value assumptions were approximately:

	For the nine months ended September 30, 2018
Grant price	$240.91
Expected option life (years)(1)	5.00
Risk-free interest rate(2)	2.22%
Expected stock price volatility(3)	24.81%
Expected annual dividends per share(4)	$2.3854
Expected forfeiture rate(5)	4.7%
Weighted-average grant date fair value per option granted during the period	$55.63

⁽¹⁾  Represents the period of time that awards are expected to be outstanding. Historical data on exercise behaviour, or when available, specific expectations regarding future exercise behaviour, were used to estimate the expected life of the option.

⁽²⁾  Based on the implied yield available on zero-coupon government issues with an equivalent term commensurate with the expected term of the option.

⁽³⁾  Based on the historical stock price volatility of the Company’s stock over a period commensurate with the expected term of the option.

⁽⁴⁾  Determined by the current annual dividend at the time of grant. The Company does not employ different dividend yields throughout the contractual term of the option. On May 10, 2018, the Company announced an increase in its quarterly dividend to $0.6500 per share, representing $2.6000 on an annual basis.

⁽⁵⁾ 

The Company estimated forfeitures based on past experience. This rate is monitored on a periodic basis.