Stock-Based Compensation (Tables)

3 Months Ended

Oct. 31, 2016

Schedule of the income statement components of stock-based compensation expense recognized in the Condensed Consolidated Statements of Income

	Three Months Ended
	October 31,
	2016		2015
Cost of sales	$	110,000	$	79,000
Operating expenses:
Selling		629,000		190,000
General and administrative		2,153,000		1,425,000
Research and development		30,000		26,000
Total operating expenses		2,812,000		1,641,000
Stock-based compensation before income taxes		2,922,000		1,720,000
Income tax benefits		(1,039,000)		(613,000)
Excess tax benefits		(2,241,000)		—
Total stock-based compensation expense, net of tax	$	(358,000)	$	1,107,000

Summary of nonvested stock award activity

		Weighted
	Number of	Average
	Shares	Fair Value
Nonvested stock awards at July 31, 2016	331,367	$	46.09
Granted	91,841		78.05
Canceled	(2,238)		55.09
Vested	(188,163)		41.61
Nonvested stock awards at October 31, 2016	232,807	$	62.23

Schedule of weighted-average assumptions used to estimate fair value of stock options

Weighted-Average
Black-Scholes Option	Three Months Ended
Valuation Assumptions	October 31, 2015
Dividend yield	0.22	%
Expected volatility (1)	55.90	%
Risk-free interest rate (2)	1.41	%
Expected lives (in years) (3)	5.00

(1) Volatility was based on historical closing prices of our common stock.

(2) The U.S. Treasury rate based on the expected life at the date of grant.

(3) Based on historical exercise behavior.

Performance Share Units

Schedule of assumptions used to estimate fair value of performance share units

Performance Share Unit	Three Months Ended
Valuation Assumption	October 31, 2016
Volatility of common stock	27.75	%
Average volatility of peer companies	32.98	%
Average correlation coefficient of peer companies	35.35	%
Risk-free interest rate	0.96	%