Shareholders' Equity Shareholders' Equity (Tables)

12 Months Ended

Feb. 02, 2019

Equity [Abstract]

Stock-based compensation expense

Stock-based compensation expense was as follows in fiscal 2019, fiscal 2018 and fiscal 2017 ($ in millions):

	2019		2018		2017
Stock options	$	3	$	6	$	9
Share awards:
Market-based	15		19		15
Performance-based	20		13		6
Time-based	85		91		78
Total	$	123	$	129	$	108

Stock option activity

Stock option activity was as follows in fiscal 2019:

	Stock Options		Weighted-Average Exercise Price per Share		Weighted-Average Remaining Contractual Term (in years)	Aggregate Intrinsic Value (in millions)
Outstanding at February 3, 2018	3,069,000		$	32.32
Granted	161,000		$	66.59
Exercised	(869,000	)	$	35.54
Forfeited/canceled	(3,000	)	$	33.01
Outstanding at February 2, 2019	2,358,000		$	33.47	4.9	$	60
Vested or expected to vest at February 2, 2019	2,358,000		$	33.47	4.9	$	60
Exercisable at February 2, 2019	2,006,000		$	30.21	4.3	$	57

Black Scholes valuation model assumptions

In fiscal 2019, fiscal 2018 and fiscal 2017, we estimated the fair value of each stock option on the date of grant using a lattice or Black Scholes valuation model (for certain individuals) with the following assumptions:

Valuation Assumptions	2019		2018		2017
Risk-free interest rate(1)	1.9% – 2.8%		0.9% – 2.6%		0.5% – 2.0%
Expected dividend yield	2.7	%	3.0	%	3.5	%
Expected stock price volatility(2)	39	%	38	%	37	%
Expected life of stock options (in years)(3)	6.5		6.0		6.0

(1) Based on the U.S. Treasury constant maturity interest rate whose term is consistent with the expected life of our stock options.

(2) In projecting expected stock price volatility, we consider both the historical volatility of our stock price as well as implied volatilities from exchange-traded options on our stock.

(3) We estimate the expected life of stock options based upon historical experience.

Summary of the status of nonvested market-based share awards

A summary of the status of our nonvested market-based share awards at February 2, 2019, and changes during fiscal 2019, were as follows:

Market-Based Share Awards	Shares		Weighted-Average Fair Value per Share
Outstanding at February 3, 2018	1,422,000		$	36.35
Granted	371,000		$	74.27
Vested	(557,000	)	$	42.04
Forfeited/canceled	(49,000	)	$	40.33
Outstanding at February 2, 2019	1,187,000		$	40.07

Summary of the status of nonvested time-based share awards

A summary of the status of our nonvested time-based share awards at February 2, 2019, and changes during fiscal 2019, were as follows:

Time-Based Share Awards	Shares		Weighted-Average Fair Value per Share
Outstanding at February 3, 2018	5,050,000		$	36.17
Granted	1,543,000		$	68.96
Vested	(2,208,000	)	$	37.30
Forfeited/canceled	(287,000	)	$	47.56
Outstanding at February 2, 2019	4,098,000		$	47.13

Summary of the status of nonvested performance-based share awards

A summary of the status of our nonvested performance-based share awards at February 2, 2019, and changes during fiscal 2019, were as follows:

Performance-Based Share Awards	Shares		Weighted-Average Fair Value per Share
Outstanding at February 3, 2018	685,000		$	37.04
Granted	354,000		$	72.11
Vested	(217,000	)	$	34.15
Forfeited/canceled	(3,000	)	$	72.05
Outstanding at February 2, 2019	819,000		$	52.78

Summary of stock options outstanding

At February 2, 2019, options to purchase 2.4 million shares of common stock were outstanding as follows (shares in millions):

	Exercisable					Unexercisable					Total
	Shares	%		Weighted- Average Price per Share		Shares	%		Weighted- Average Price per Share		Shares	%		Weighted- Average Price per Share
In-the-money	2.0	100	%	$	30.21	0.3	75	%	$	43.86	2.3	96	%	$	31.72
Out-of-the-money	—	—	%	$	—	0.1	25	%	$	71.52	0.1	4	%	$	71.52
Total	2.0	100	%	$	30.21	0.4	100	%	$	52.01	2.4	100	%	$	33.47

Reconciliation of the numerators and denominators of basic and diluted earnings per share

The following table presents a reconciliation of the numerators and denominators of basic and diluted earnings per share from continuing operations in fiscal 2019, fiscal 2018 and fiscal 2017 ($ and shares in millions, except per share amounts):

	2019		2018		2017
Numerator
Net earnings from continuing operations	$	1,464	$	999	$	1,207
Denominator
Weighted-average common shares outstanding	276.4		300.4		318.5
Effect of potentially dilutive securities:
Stock options and other	5.0		6.7		4.1
Weighted-average common shares outstanding, assuming dilution	281.4		307.1		322.6
Anti-dilutive securities excluded from Weighted-average common shares outstanding, assuming dilution	0.2		—		4.5
Net earnings per share from continuing operations
Basic	$	5.30	$	3.33	$	3.79
Diluted	$	5.20	$	3.26	$	3.74

Repurchases of common stock

The following table presents information regarding the shares we repurchased and retired in fiscal 2019, fiscal 2018 and fiscal 2017 ($ and shares in millions, except per share amounts):

	2019		2018		2017
Total cost of shares repurchased
Open market	$	1,493	$	2,009	$	706
January 2016 ASR	—		—		45
Total	$	1,493	$	2,009	$	751
Average price per share
Open market	$	70.28	$	57.16	$	36.11
January 2016 ASR	$	—	$	—	$	28.55
Average	$	70.28	$	57.16	$	33.54
Number of shares repurchased and retired
Open market(1)	21.2		35.1		19.5
January 2016 ASR	—		—		1.6
Total	21.2		35.1		21.1

Components of accumulated other comprehensive income, net of tax

The following table provides a reconciliation of the components of accumulated other comprehensive income, net of tax, for fiscal 2019, fiscal 2018 and fiscal 2017, respectively ($ in millions):

	Foreign Currency Translation
Balance at January 30, 2016	$	271
Foreign currency translation adjustments	10
Reclassification of foreign currency translation adjustments into earnings due to sale of business	(2		)
Balance at January 28, 2017	279
Foreign currency translation adjustments	35
Balance at February 3, 2018	314
Foreign currency translation adjustments	(20		)
Balance at February 2, 2019	$	294