XML 46 R33.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Stock-Based Compensation (Tables)
 12 Months Ended
Dec. 31, 2019
Share-based Payment Arrangement [Abstract]  
Schedule of Number of Common Shares Reserved for Issuance
The number of common shares reserved for issuance are as follows: 
(in millions)
December 31,
 
2019
 
2018
Shares available for granting 1
20.0
 
33.3
Options outstanding
0.7
 
1.7
Total shares reserved for issuance 2
20.7
 
35.0
1
Shares available for granting at December 31, 2019 and 2018 are under the 2019 Plan and 2002 Plan, respectively.
2
Shares reserved for issuance under the Director Deferred Stock Ownership Plan are not included in the total, but are less than 1.0 million at December 31 2019 and 2018, respectively.
Schedule of Stock-based Compensation Expense
Stock-based compensation expense and the corresponding tax benefit are as follows: 
(in millions)
Year Ended December 31,
 
2019
 
2018
 
2017
Stock option expense
$
1

 
$
5

 
$
3

Restricted stock and unit awards expense
77

 
89

 
96

Total stock-based compensation expense
$
78

 
$
94

 
$
99

 
 
 
 
 
 
Tax benefit
$
13

 
$
19

 
$
38
Schedule of Assumptions Used in Valuing the Options Granted
We use a lattice-based option-pricing model to estimate the fair value of options granted. The following assumptions were used in valuing the options granted:
 
 
Year Ended
 
 
December 31, 2018
Risk-free average interest rate
 
2.6 - 2.7%

Dividend yield
 
1.1
%
Volatility
 
21.8 - 22.0%

Expected life (years)
 
5.67 - 6.07

Weighted-average grant-date fair value per option
 
$
112.98



We use a lattice-based option-pricing model to estimate the fair value of options granted. The following assumptions were used in valuing the options granted: 
 
Year Ended
 
December 31, 2018
Risk-free average interest rate
2.6 - 2.7%

Dividend yield
1.1
%
Volatility
21.8 - 22.0%

Expected life (years)
5.67 - 6.07

Weighted-average grant-date fair value per option
$
112.98
Schedule of Stock Option Activity
Stock option activity is as follows: 
(in millions, except per award amounts)
Shares

Weighted average exercise price

Weighted-average remaining years of contractual term

Aggregate intrinsic value
Options outstanding as of December 31, 2018
1.7

 
$
47.92

 
 
 
 
Exercised
(1.0
)
 
$
163.99

 
 
 
 
Forfeited and expired 1
—

 
$
70.70

 
 
 
 
Options outstanding as of December 31, 2019
0.7

 
$
55.73

 
3.1
 
$
155

Options exercisable as of December 31, 2019
0.7

 
$
55.12

 
3.0
 
$
151

1 There are less than 0.1 million shares forfeited and expired.

(in millions, except per award amounts)
Shares

Weighted-average grant-date fair value
Nonvested options outstanding as of December 31, 2018
0.1

 
$
113.02

Vested 1
—

 
$
113.42

Forfeited
(0.1
)
 
$
113.17

Nonvested options outstanding as of December 31, 2019 2
—

 
$
112.68

Total unrecognized compensation expense related to nonvested options
$
0.3

 
 
Weighted-average years to be recognized over
0.7

 
 
1 
There are less than 0.1 million shares vested.
2 
There are less than 0.1 million nonvested options outstanding as of December 31, 2019.
Schedule of Stock Option Exercises
Information regarding our stock option exercises is as follows: 
(in millions)
Year Ended December 31,
 
2019
 
2018
 
2017
Net cash proceeds from the exercise of stock options
$
40

 
$
34

 
$
75

Total intrinsic value of stock option exercises
$
110

 
$
77

 
$
118

Income tax benefit realized from stock option exercises
$
33

 
$
27

 
$
64
Schedule of Restricted Stock and Unit Activity
Restricted stock and unit activity for performance and non-performance awards is as follows: 
(in millions, except per award amounts)
Shares
 
Weighted-average grant-date fair value
Nonvested shares as of December 31, 2018
0.8

 
$
172.24

Granted
0.5

 
$
187.40

Vested
(0.6
)
 
$
144.18

Forfeited
(0.1
)
 
$
179.76

Nonvested shares as of December 31, 2019
0.6

 
$
199.93

Total unrecognized compensation expense related to nonvested awards
$
72

 
 
Weighted-average years to be recognized over
1.8

 
 


 
Year Ended December 31,
 
2019
 
2018
 
2017
Weighted-average grant-date fair value per award
$
187.40

 
$
182.75

 
$
147.12

Total fair value of restricted stock and unit awards vested
$
153

 
$
154

 
$
147

Tax benefit relating to restricted stock activity
$
29

 
$
32

 
$
36